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Punitive action against Reliance firm, Navy encashes bank guarantee in vessel deal

Press Trust of India  |  New Delhi 

In a punitive action, the has encashed a given by the due to inordinate delay in supplying five offshore patrol vessel, and said Monday the deal is being looked into.

"There is no preferential treatment being given to RNEL. Its has been encashed. Punitive action has been taken against it. The process is being taken forward," said at a press conference.

The was asked about huge delay in delivery of the vessels by the company and whether Navy is under any pressure to not initiate any action against the company.

Lanba said the deal is not being cancelled at the moment but added that it is being looked into, indicating that government may take a call on the issue.

The Navy also said that the company is undergoing corporate debt restructuring.

There was no immediate reaction from RNEL about the Navy Chief's comments.

Anil Ambani's Reliance Defence has been at the centre of a controversy over the Rs 58,000-crore Rafale jet fighter deal. The has accused the government of favouring the company.

The company as well as the government have rejected the charges.

The original contract worth Rs 3,000 crore for five offshore patrol vessels was won by Engineering in 2011. The company was bought over by group in 2016.

According to the original contract, the first vessel was to be delivered by early 2015. However, the deadline was pushed several times.

(This story has not been edited by Business Standard staff and is auto-generated from a syndicated feed.)

First Published: Mon, December 03 2018. 19:56 IST