The Ministry of Defence under the Narendra Modi-led NDA government, which ousted former Prime Minister Manmohan Singh’s UPA-II in May 2014, intended to stop all ongoing and future transactions with the Finmeccanica group, now linked to the VVIP helicopter scam.
The MoD issued two separate office orders in August and September 2014 stating guidelines to be adopted by its officials in dealing with the Finmeccanica group and its other sister companies.
The first office order, issued on 22 August 2014, divided the stages of procurement/acquisition involving the MoD and Finmeccanica into six categories, while also pronouncing a separate policy that needed to be adhered to as per the respective categories. In the first two categories, where the contracts were either already under execution with any company of Finmeccanica or where contracts were already executed but spare parts were required on a regular basis, the MoD directed that “there is no reason not to proceed with the contracts”.
However, the order, while referring to cases where “vendor (Finmeccanica)” has been declared as L-1 (the vendor who has quoted the lowest offer) after the process of tendering, stated that “all such procurements and acquisition order shall be put on hold”. The order also barred the officials from considering Finmeccanica in any bid which was still ongoing. It further prohibited officials from giving tender papers to any company of the Finmeccanica group, even when the tender process was yet to begin. The officer order further stated it should not matter if a company under the Finmeccanica group of companies is a subcontractor/supplier to the contracting party with Government of India.
The office order, which was signed by Atul Kumar Singh, Director (vigilance), stated that these instructions were restricted to the Finmeccanica group of companies, including M/S Augusta Westland International Limited, UK only.
A subsequent order dated 3 September 2014, which was again signed by Atul Kumar, put on hold all procurement and acquisitions with Finmeccanica group of companies that were in pipeline.
The companies with whom any kind of ongoing and future transactions was prohibited included M/s Agusta Westland International ltd UK, M/s Finmeccanica, Italy and its group of companies, including subsidiaries and affiliates, M/s IDS, Tunisia, M/s Infotech Design System (IDS), Mauritius, M/s IDS Infotech ltd Mohali, M/S Aeromatrix Info Solutions Pvt Ltd, Chandigarh.