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CBI registered an FIR against unknown public servants of
the
Ministry of Defence, Government of India, M/s Denel (Pty)
Ltd., South
Africa and their officials, M/s Varas Associates, Douglas,
Isle of Man
and their officials and others in connection with the allegation
of
payment of 12.75% commission to M/s Varas Associates, allegedly
for the
procurement of contracts for supply of Anti Material Rifles
(AMRs). The
case has been registered under section 120-B IPC r/w section
420 IPC and
9 & 13(2) r/w 13(1)(d) of the Prevention of Corruption
Act, 1988.
The contracts in which allegedly commissions were paid in
violation of
contract are:
(i) Contract of 01.07.1999 for procurement of 100 AMRs with
98,000 rounds
of ammunition,
(ii) Contract of 20.03.2002 for procurement of 100 AMRs with
1,00,000
rounds of ammunition,
(iii) Contract of 27.03.2002 for procurement of 100 AMRs with
1,00,000
rounds of ammunition and
(iv) Contract of 07.03.2005, comprising two separate contracts
- the
first one for procurement of 400 AMRs and the second one for
Transfer of
Technology (including 100 SKD and 200 CKD form of AMRs) to
Ordnance
Factory Board
The following allegations have been, inter-alia, mentioned
in the FIR:
(i) M/s Denel paid Varas Associates, a Company based in Isle
of Man, two
sums of $24,08,373 and $10,99,672 on January, 27, 2003 and
$1,51,350 on
June 19 of the same year.
(ii) The invoices in question were sent by Varas's Office
in Douglas,
Isle of Man, to the Headquarters of Denel. The first signed
by an
unknown person and dated May 1, 2002 is for $1,43,446 for
"fees for
technical services as per agreement". The third signed
by Marc Craig
Veitch in his capacity as Director and dated 30 May, 2003
is for
$4,50,364 also for "technical services". The second
apparently signed by
Veitch and dated December 8, 2002 for $3,93,720 for "fees
for consulting
and technical services as per agreement, allegedly relates
to the arms
deal with India", giving as a reference "project
- AM2 and AM3", which
reportedly was the contract for Denel produced rifle.
(iii) M/s Varas Associates, which was appointed to act as
an agent for
Denel by its Head Office, was paid 12.75% commission on all
deals that it
secured for Denel.
(iv) M/s Varas Associates traded on its influence with the
Indian
military's Price Negotiation Committee (PNC) in New Delhi.
A document
purporting to be secret minutes of a PNC Meeting on 23rd May
2003 to
procure 200 AMRs and 1 lakh rounds of ammunition with TOT,
had allegedly
been provided by Varas Associates to Denel as part of its
'consulting and
technical services' for Denel's rifle project.
It is further alleged in the FIR that in spite of the specific
prohibition for engagement of agents in the procurement process
in the
different contracts entered into between M/s Denel (Pty) Ltd.,
South
Africa and Govt. of India, New Delhi, and also in the 'Requests
for
Commercial Proposals' in respect of the different contracts,
the said
M/s. Denel (Pty) Ltd. had allegedly appointed M/s Varas Associates,
a
Company based in Isle of Man, as an agent for Denel which
was allegedly
paid 12.75% commission on all deals that it secured for Denel.
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