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AgustaWestland guarantees: Defence ministry to take steps to recover amount

LiveMint logoLiveMint 25-05-2014 PTI

New Delhi: After an Italian court partially lifted the freeze and allowed India to encash bank guarantees worth Rs1,818 crore deposited by AgustaWestland in the VVIP chopper deal, the defence ministry on Sunday said it will take “immediate steps” to fully recover the amount.

The Italian court on 23 May allowed India to recover Rs1,818 crore of the Rs2,217 crore deposited in Italian banks by AgustaWestland in the VVIP chopper deal which has been scrapped by India on charges of corruption and bribery.

“The Milan court, in its judgement has substantially upheld the claims of Indian government against AgustaWestland International Ltd (AWIL), AW Spa and Deutsche Bank, Italy on the encashment of bank guarantees and performance bond in the VVIP helicopter case. The court also ordered AWIL and AW Spa to reimburse legal costs of government of India. The defence ministry is studying the order and will take immediate steps to recover the amount fully,” a defence ministry release said.

After the Rs3,600 crore deal was cancelled on 1 January this year, India had initiated the process to seize bank guarantees deposited in banks in Italy and India. While the money deposited in Indian banks was encashed, the Italian court had stayed the process of seizure in that country.

India has been working on procedures to claim more than €650 million (about Rs5,470 crore) from the company in the form of seizure of bank guarantees and imposing penalties.

India scrapped the contract on 1 January over allegations of bribery and payment of kickbacks in the contract worth Rs3,600 crore for supplying 12 AW-101 choppers. The defence ministry had also initiated the process to blacklist the firm but the solicitor general advised it to “wait” before taking any action in this regard in view of the ongoing probes in the case in both India and Italy. PTI

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