NEW DELHI --- The defence ministry has suspended all business dealings with the companies of absconding arms dealer Sanjay Bhandari, who is facing cases for violating the Official Secrets Act as well as alleged financial crimes ranging from money laundering to corruption in arms deals.
The defence ministry's vigilance wing on Friday issued an order to all departments and wings as well as the Army, IAF and Navy headquarters to suspend all business dealings with Bhandari's flagship Offset India Solutions (Private) Ltd and all its group companies with immediate effect.
"The OIS Group's response to a show-cause notice in June 2017 was not found satisfactory. So, business dealings with the OIS Group, its companies and functionaries will remain suspended for six months or until further orders, in accordance with the MoD guidelines issued in November 2016 to deal with such cases," said an official.
The guidelines were promulgated "to ensure probity, transparency, propriety and compliance" in the defence procurement process. At present, MoD has debarred four major foreign and two Indian companies for 10 years, while business dealings are suspended with 13 other firms.
As for the case against OIS (P) Ltd, which handles offsets for several foreign companies, the CBI is investigating allegations of graft against Bhandari and his associate Bimal Sareen in the Rs 2,896 crore deal to procure 75 Swiss Pilatus PC-7 basic trainer aircraft (BTA) inked in May 2012.
The propeller-driven Pilatus aircraft were an emergency purchase after IAF training schedule went haywire following the grounding of the entire fleet of the 114 old piston-engine HPT-32 aircraft after a crash killed a trainee pilot in August 2009.
Though rookie IAF pilots are currently undergoing their Stage-1 training on the Pilatus aircraft to learn the basics of instrument and tactical flying, the inking of the "follow-on" contract to acquire 38 more such turboprop planes for Rs 1,450 crore has been put on hold due to the allegations of graft in the original deal. The lack of a "maintenance transfer of technology (MtoT) pact has also put a big question mark on the future of the IAF's existing Pilatus fleet. (end of excerpt)
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