Tag Archives: CBI

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CBI probes role of DRDO employee in possible graft

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 By Abhinandan Mishra  May 5, 2024

NEW DELHI: Aeronautical Development Establishment, a Bengaluru-based DRDO lab that developed the Lakshya aircraft, has been visited by the CBI.

Possible misuse of hundreds of crores of rupees related to a premier pilotless aircraft system, which was developed by the Defence Research and Development Organization (DRDO), has come to the notice of the Central Bureau of Investigation (CBI) last month, after which the CBI has started its preliminary enquiry in the matter.

Aeronautical Development Establishment (ADE), a Bengaluru-based lab of the DRDO, that developed the pilotless target aircraft, “Lakshya” has been visited at least twice by the CBI officials in the past one month.

The alleged scam, in which critical components needed for this project like small aircraft and trucks, were procured but only on paper while some went “missing”. Despite the ADE top officials who are handling the project, being made aware of these discrepancies at least since 2015, did not report these to the CBI but rather allegedly victimized the official who brought it to their notice, while refusing to be a part of the coverup.

As per rules, whenever an item or material is purchased for the development of any program, Lakshya in this case, and when it is brought physically to the ADE campus, an entry is done in the ledger detailing the said product. The said ledger is handled by a permanent employee of the DRDO and once he moves out either due to retirement or new posting, the said ledger is then handed over to another employee, who first checks all the inventories are there as mentioned in the books before taking over the possession of the ledger.

There are two ledgers that are used to ensure products don’t go “missing”. The first one is the Personal Ledger (PL) in which an item purchased under the “general head” is entered.

Then there is the Project Personal Ledger or PPL in which items purchased under “project head” are entered.

This is done to ensure that whatever was paid for by the Government of India is actually bought and delivered and it’s the accountability and responsibility of the officer holding the ledgers to make sure that details in the ledgers match the material in the campus and the lab.

As per the details accessed by the CBI, a “PL number 613”, which contains products and materials purchased for Lakshya, was till 31 January 2011 being handled by B.R. Suresh, a Scientist-D with ADE.

When he retired on that date it was revealed that materials including pilotless target aircrafts, trucks, electronic sub system were missing and hence the matter was recorded internally and the post-retirement benefits of Suresh were withheld, but were subsequently released after four years, said sources.

In January 2015, the project director of Lakshya, V. Subramaniam asked one of his juniors to take over the PL that was earlier the responsibility of B.R. Suresh. Sources said that till then, the responsibility of the PL was not entrusted to anyone.

As was required under the rules, the said officer, before taking over the responsibility of PL-613, went to the lab to verify whether all the listed and purchased material were present or not.  

 crores, that were listed in the PL, were missing.

The missing inventory included at least 5 aircraft, 10 trucks, 50 tow bodies and 10 gyroscopes.

As per the information received by the CBI, Subramaniam asked the said officer to take the responsibility of the PL register, without mentioning the discrepancies, which Subramaniam claimed he would “manage’ by manipulating the content. In lieu, the said officer was promised swift promotion. The said officer, however, refused to accept the responsibility of the ledger.

Upon witnessing the refusal to take the handover of the PL, Subramaniam is alleged to have taken away access of the said scientist to his workplace and started harassing him.

The said officer, who had reached out to the other top officials in the lab to inform them of these discrepancies, received no help and for 28 months, no salary was given to him.

Those close to Subramanian say that such charges against him are baseless and motivated. In a response to The Sunday Guardian’s queries on the matter, DRDO, while confirming that a CBI probe at ADE, Bengaluru with regards to the Lakshya project was going on, stated that, “As per statements of ex Lakshya Project Personnel and available records, no discrepancies related to material needed for this project were communicated to the top officials anytime during 2011 or in 2014.”

Messages sent to Subramaniam did not elicit any response till the time the report went to press.

In 2019, Subramanian, now in the position of “Scientist-G” who was not originally on the interview panel that was constituted to interview and promote his erstwhile junior, made himself a member of the panel and ensured that the junior was denied the promotion. This happened despite the said scientist requesting the Human Resources head to not be interviewed by a panel that had his former boss as the member.

In November 2021, a memorandum of major penalty was filed against the scientist for “unauthorised leave” during the period when his access to his lab was withdrawn by Subramaniam which did not allow him to mark the attendance.

It is pertinent to mention that ADE and DRDO both had come under severe criticism from relevant government bodies for their failure to execute Lakshya on time despite the government releasing funds and other resources without any delay.

Subramaniam, who retired in May 2023, is still coming to the ADE campus regularly despite having been accorded no responsibility that would necessitate his visit to the campus, especially when an inquiry has been going on with regards to the discrepancies in Lakshya ledger that was his responsibility.

Last month, amidst the ongoing CBI investigation, crucial files related to the said project were allegedly dumped in the dump yard of the campus to be destroyed.

This happened after the CBI officials visited the campus on 28 March. The agency officials visited the campus again on 19 April.

Lakshya had a total of four projects—Lakshya, Lakshya LSP (Limited Series Production), Lakshya 1-D (partially digital version) and Lakshya 2, which was the fully digital version. The project has been a huge technical success.

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ACB,CBI, Chandigarh – Jai Ho

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To                                                                                                              24 May 2021

The Director, CBI

Plot No 5-B CGO Complex,

Pragati Vihar,

New Delhi –110003

Subject: Request to deployed more staff in ACB, Chandigarh

Sir,

  1. I have sent a complaint to the ACB, CBI, Chandigarh on 16 October 2020 based on a detailed departmental investigation report corruption in the procurement of some equipments by Snow Avalanche Study Establishment. DRDO. Him Parisar, Plot No.1, Sector 37A, Chandigarh – 160 036  (SASE). The equipments were purchased at an inflated cost of shockingly to the tune of 50 times of the original cost.  As per the documents it is evident that there is Malafied act of corruption but DRDO seems to be indifferent to act on it.  These equipments used in Avalanche forecasting studies which are of very strategic importance. If such level of corruption is happening, it is directly affecting strategic interests of the nation. Because of these corrupt scientists more than 90% equipments are not working and that will be a sabotage of life risk of our great soldiers.  
  2. Now I have received the letter from Vigilance DRDO for confirming the complaint after passing 6 months. The DRDO letter enclosed the ACB letter mentioned that “this office has not conducted any open enquiry in to the matter”
  3. To my utter disappointment, instead of conducting an independent enquiry into the allegations based on complaint with all supporting documents, the Chandigarh unit of CBI simply forwarded the information to Director Vigilance of DRDO (Not even to CVO of MoD). Effectively it is simply passing on the buck to the organization which is not interested to tackle corruption in its organization, because the department enquiry document itself shows that after enquiry till date no action have been taken on this matter and buried under the table.
  4. The corruption they are doing in such system which directly deploy in various snowbound border areas and collect the data and on the basis of these data they pass information to defence forces which conduct the patrolling in these snowbound areas. Because of these corrupt scientists more than 90% are not working and that will be a sabotage of life risk of our great soldiers.
  5. I am fighting ageist corruption since last 20 years and lot of CBI officers, IB, Officers met me during this period across the India and most of I have found that they are working hard to get input/lead of corruption and national security and surprisingly in this case I found that ACB, Chandigarh not having any interest first he sit with information for six months and now just passing the ball to same department who are helpless to act against corrupt scientists for unforeseen reasons.
  6. So I personally feel that the ACB, Chandigarh having lot of investigations and is not able to give time for this act of corruption and sabotage of national security case.  I urge the Director, CBI to conduct an independent investigation by the responsible official for the corruption in strategic work of DRDO organization and ensure exemplary punishment to the accused through court if law..
  7. To save the life of our defence personal and stop the siphoning of poor tax payer money your early action is required.

Regards

Prabhu Dandriyal

21-0 sunderwala, Raipur

DEHRADUN-248008

9411114879, prabhudoon@gmail.com , www.corruptionindrdo.com

Enclosed: 

1.   Copy my letter to ACB.CB, Chandigarh along with copy of DRDO enquiry report.

2.   Copy of ACB.CBI, Chandigarh letter address to Vigilance, DRDO Hrs

3.   Copy of Vigilance, DRDO Hrs letter

Copy to

  1. Prime Minister of India – At the moment, the entire nation is battling with Corona and lot of funds is required to save the precious lives. Every hard earned penny of tax payer is needed to strengthen health care system.  Siphoning of national exchequer should be treated as serious crime in the need of hour.
  • Defence Minister – I am bringing to your notice a corruption of high level where key defence scientists are involved that may risk life of soldiers who are patrolling in snowbound border areas. Action  requested in your end
  • Chairman, DRDO – for information please, because action …………
PMO

Appeal to Independent Directors of BEL on Rs 7900 Cr Scam in IACCS Project

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To

Dr. Bhaskar Ramamurthi, Director at IIT, Chennai,
Dr. R K Shevgaonkar, Professor at IIT, Mumbai,
Mrs. Usha Mathur, ex-Secretary to Govt. of India,
Mr. Sharad Sanghi, Entrepreneur,
Shri Mukka Harish Babu, Practicing Chartered Accountant,
Shri Surendra Singh Sirohi, ex-Secretary to Govt. Of India,
Shri Vijay S Madan, ex-Secretary to Govt. Of India,
Dr. Amit Sahai, Joint Secretary (P&C), Ministry of Defence, Department of Defence Production,
Ms J Manjula, Distinguished Scientist & Director General-Electronics & Communication Systems, DRDO,

ushamathur@hotmail.com,
harish@harishassociates.com,
bhaskar@iitm.ac.in,
vc@bennett.edu.in,
secretarial@hfcl.com,
sdpns@nic.in

MASSIVE CORRUPTION IN AIRFORCE UNDERGROUND STRUCTURE, IMPLEMENTATION AGENCY DEFENCE PSU BHARAT ELECTRONICS SUSPENDS ITS OWN INVESTIGATING OFFICERS FOR UNEARTHING ROLE OF CMD & TOP OFFICERS

In an unprecedented move the defence public sector undertaking Bharat Electronics Limited (BEL) has suspended three senior officials, who unearthed massive irregularities in the Indian Air Force’s confidential IACCS project- underground bunkers- at 10 strategic locations. The three officials were part of Inquiry committee set up by the BEL’s Chief Vigilance officer (CVO) in July 2018 . The team exposing the role of high ranking officers and manipulation of awards of contracts in Rs.8000 Crore project had submitted the report in October 2018. Instead of taking action against the corrupt officers, BEL management led by its Chairman MV Gowtama, who himself is under the scanner in IACCS project, acted with vengeance and suspended the investigation team members.

It is pertinent to mention that after three-member probe committee submitted the report, BEL CVO , a senior IAS officer MR S.SHIVA KUMAR  1987 BATCH in his note dated 29 March 2019 exposed the deep-rooted corruption recommending strong action against erring officers and firms. Yet, the CMD , who is likely to be arrested if a probe is ordered, cracked the whip against inquiry committee members for doing honest job. This crackdown is in spite of  the fact that the CVO of the company as appointed by CVC of India had established and validated each point of the investigation report  and strongly recommended to management of BEL for immediate police and civil criminal action against concerned BEL officers and chief consultant of the project M/s RD KONSULTANT.  The role of senior DRDO officers is also under the scanner since it was DRDO which recommended and fully supported the name of RD Konsultant to BEL although it was done informally and BEL surreptitiously avoided DRDO role in the files.The role of DRDO officers was brought out and exposed by the BEL vigilance probe team which was suspended on 17 May 2019.  To distract the government’s IB report, CMD, BEL created suspension drama of three personal of BEL, 2 GM Vigilance and one manager to fooling the country. This shows the clear mockery of BEL management.

M/S RD KONSULTANT – DELHI  , which came out to be a shell company in investigation report , incorporated just 3-4 months before the award of PPR consultancy project with all false  and fabricated documents, and was wrongly  awarded DPR consultancy project also violating BEL own manual procedures as well CVC guidelines with a criminal intent of having control over all future activities of civil contract as well infrastructure/ Plant and machinery  items procurement worth more than Rs 3500 crores, as recorded in noting files  and  many senior management personals of M/S BHARAT ELECTRONICS , which is continuously being done since UPA CONGRESS REGIME 2011.

One very interesting fact of the whole case is that the two BHARAT ELECTRONICS senior management personals named Mr N.K. SHARMA DIRECTOR( MARKETTING) and MR CHANDERPRAKASH EXECUTIVE DIRECTOR (D&E) GAD, who were the chief &key persons for co ordinating the IACCS project getting approved from Indian air force, joined  a company named “OIS ADVANCE TECH” – 90% OWNDED BY MR SANJAY BHANDARI – famous arms dealer & power broker  and close associate of ROBERT WADRA immediately after their retirement from BEL in 2010 and 2011, and immediately after this this project got formally started by BEL . 

The detailed and very exhaustive investigation done by fact verification team in early 2018 and further investigation team in end 2018 and subsequently report by CVO of M/s Bharat Electronics has established the details of  massive corruption and mal practices done by M/S RD Konsultant, its associate/related firms and senior management persons of BEL  ( since 2011 onwards till now), by abusing their powers and violating all BEL manuals as well as documented CVC guidelines for tendering for award of civil project works and procurement of items worth more than 3500 crores.

These civil contract worth more than 1000 crores have been given of paper to reputed firms like M/S L&T but at almost 30 % higher and inflated rates (as also mentioned by then Director (Finance) Mr PRABHAT ACHARYA in file noting about more than 100 crore loss as well as violation of BEL Contract manual conditions as well as CVC guidelines) and after some period he resigned from company. After this project given to m/s L&T are being done by M/S RD consultant sister concern named M/S CS CONSTRUCTIONS at sites ( even MD- Mr Rahul Baucher  of M/S CS Construction used to come to BEL-Ghaziabad unit  for regular review meeting on behalf of L&T) – A serious violation of CVC  guidelines as well contract conditions of BEL & M/S RD KONSUL) , which seriously compromise the quality , as it is a very small petty company which in no way  has a technical capability and skill to deal such highly technical and secured project. This fact as validated by the fact that some sites were shown as collapsed during construction and crores of rupees were further approved by BEL management in name of deviation with fixing the responsibility on contractor.

The detailed design which was submitted by M/s R.D. Konsultants specified vendors for all the sub-systems which are used in the blast proof underground buildings. It is seen that these vendors are the same which they had brought out to be their partners during presented made by then during the Pre-qualification bid. The Order which was placed on BEL by Air Force was also based on the detail design report submitted by M/s R.D. Konsultants and hence all these vendors called in the order from Air Force were the same which were defined by M/s R.D. Konsultants.BEL has in turn placed many orders for the sub-systems based on the vendors defined by M/s R.D. Konsultants. A visit was made to the works of many of these European vendors by a team of engineers from BEL along with Air Force personnel. But is it said that the team was accompanied by a rep from M/s R.D. Konsultant and the visit was coordinated by M/s R. D. Konsultant. These foreign companies were allowed to supply materials on a single tender basis by the BEL chairman MV Gowtama. He in fact overruled his own officials and approved qualification of several firms despite they had failed to submit bid details during prescribed time. Such gross violation was similar to the ones seen during 2G scam. BEL Chairman violated the laid down norms by allowing these foreign firms despite objections duly recorded by the finance division.

All above shows a case of massive corruption, fraud and abuse of power with criminal intent and a huge loss to Government public money by BEL senior management persons in connivance with chief consultant, EX DRDO and some IAF officials. The whole investigation report findings are finally found true of the fact that as it is learnt from top BEL & DRDO sources last week M/s RD Konsultant has written to BEL MANAGEMENT that as his chief designer has left the company and the firm has gone bankrupt, he cannot give consultancy services to this project. Now on this bogus consultancy company’s  design, specifications and whole scheme of the project BEL management has already  spend thousands of crores of public money  and suppose its design does not work then who will own the responsibility of whole scam. Now the news that the firm M/S RD KONSULTANT is running out of project the reason could only be because his fraud has come out in media and BEL current management instead of taking legal action against the corrupt, trying to harass and victimize the honest and brave investigation team members ( in name of media leak- which even our prime minister call  as a strong pillar of democracy) .

The team which is suspended and currently facing all type of harassment, victimization and humiliation of suspension, but in spite of all pressures and threats, have unearthed this scam just to keep the spirit of national security and defence importance   and demand only for justice but calling for a detailed CVC/CBI/ED enquiry outside BEL management preview immediately and immediate intervention of MINISTRY OF DEFENCE for action on some BEL senior management for their misdeeds

A honest and sincere appeal to all  concerned officials of PMO/MOD /CVC/PRESS/JUDITARY that please take immediate action in this regard to keep “CHOWKIDAR “ alive in our souls  by safeguarding the honour of investigation team officials.

ABOVE ALL MATTER IS COVERED IN DETAILS BY  A REPUTED NEWPAPER

“FIRSTPOST”  IN ITS ARTICLE DATED 02 APRIL, 09 APRIL & 26 April 2019

Before publishing in media the matter was available with AF Intelligence, CVO, CBI, North Block, Chairman, DRDO, IB in March itself but god knows why any agency not take-up this matter seriously.

Hope you will take up matter seriously as you are responsible Member, Audit Committee and Director of BEL and may be aware of all developments from side of BEL management who are posing that matter is mare deviation of 50/60 lakhs as a bonafide fighter against defence corruption since more than 20 years I am fully aware of nexus. This nexus was designed by Retired Scientist of DRDO with ex DRDO chief because the U/G work of services was sole right of DRDO via SPIC, but when retirement stage these corrupt DRDO official gang create the scene and diverted this activity to BEL which doesn’t have any type construction division like DRDO have, U/G plant machinery experience either trading nor manufacturing in this tender only 500 cr electronics involvement can BEL claimed. As per investigation and observation it is clearly visualize that few greedy BEL official trapped in vicious DRDO official and for sake of few bucks they compromised with national security as well as their organization’s dignity. Please ask the vigilance report prepared by these three suspended BEL employees, Report is not an eye opener but will help govern to expose UPA era nexus who are responsible to siphon the defence budget under shadow of secrecy.

PMO

Pilatus aircraft deal: CBI has fugitive arms dealer Sanjay Bhandari, bureaucrats in its crosshairs

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Yatish Yadav Jun 22, 2019 16:10:17 IST First Post
New Delhi: A few days after the conclusion of Aero India Show at Bengaluru from 6 to 10 February in 2013, a six-page intelligence note landed at the desk of then chairman, Central Board of Direct Taxes (CBDT) detailing unusual activities of certain companies owned by fugitive arms dealer Sanjay Bhandari. The note purportedly provided the first solid evidence against Bhandari, who at that point of time, was allegedly using four firms registered in India to influence a majority of defence contracts.
Bhandari allegedly had a battery of retired defence public sector undertakings officials on his payroll. Firstpost on 9 April reported that two senior officers of Bharat Electronic Limited (BEL) who joined Bhandari’s firm after retirement, were under the scanner of investigating agencies in the basic trainer aircraft deal. The note highlighted crores spent at the Aero India Show by Bhandari’s firm AVAANA and warned about his links into procurement of 75 basic trainer aircraft for which India inked a Rs 2,859 crore deal in May 2012 with Switzerland-based Pilatus Aircrafts.

File image of arms dealer Sanjay Bhandari. CNN-News18

A year later, the Income Tax Department launched a probe and almost three years after the first warning against Bhandari, a preliminary inquiry was launched by the Central Bureau of Investigation (CBI) which culminated in an FIR against the arms dealer, his firms, close aides and the Swiss company.

The CBI tracked down the alleged kickbacks paid to Bhandari’s firms under the garb of consultancy fees. The CBI said after Request for Proposal (RFP) was floated by the Indian Air Force (IAF) in December 2009, Pilatus Aircrafts, Switzerland, dishonestly and fraudulently signed a service provide agreement with Bhandari’s firm Offset India Solutions Private Limited. This pact between the two firms in a bid to obtain the contract for supply of 75 basic trainer aircrafts to the IAF, was in violation of the defence procurement procedure, the agency stated.

“In furtherance of the said criminal conspiracy, Pilatus Aircrafts Limited made payment of 10,00,000 Swiss Franc (in 2010, 1 Swiss Franc was equal to approximately Rs 47) in account No. 52105058250 of M/S Offset India Solution Private Limited with Standard Chartered Bank, New Delhi in two tranches during August & October 2010 and also transferred huge funds, i.e. 49887900 Swiss Franc (Approximately Rs. 350 Crores) during 2011 to 2011 in the bank accounts of Dubai based company namely M/S Offset India Solutions FZC belonging to Sanjay Bhandari to obtain the contract for 75 basic trainer aircrafts. It is revealed that M/S Pilatus Aircrafts Limited dishonestly and fraudulently signed a pre contract integrity pact on 12.11.2010 with Ministry of Defence, deliberately concealing the facts about signing the aforesaid service provider agreement with Sanjay Bhandari,” the CBI said.

The investigating agency claimed Pilatus Aircrafts concealed the first payment of 10,00,000 Swiss Francs made to Offset India Solutions Private Limited and subsequent payments made to Bhandari in Dubai. The agency suspects the money paid to Bhandari was to influence the public servants of IAF and Ministry of Defence associated with the procurement process. After the deal was signed between Pilatus and Ministry of Defence in May 2012, a huge cash amount was moved by Bhandari from one company to another and even in the account of his wife in order to layer the transactions.

CBI said: “Offset India Solutions Private Limited and other Indian companies of Sanjay Bhandari namely OIS Advanced Technology Private Limited , AVAANA Software & Services Private Limited, SB Hospitality & Services Private Limited, Himalayan Helicorp Private Limited, Santech Investment Private Limited, Micromet ATI India Private Limited and Sonia Bhandari wife of Sanjay Bhandari, received Rs 25.5 crore during June 2012-March 2015 in lieu of cash provided by Sanjay Bhandari from various companies of Deepak Aggarwal, namley, Arti Securities & Services Limited, Hare Krishna Garments Private Limited, I-Tech Insurance Brockers Private Limited, Mysore Finlease Limited, Sperryn Gas Products Limited, Jaguar Equity Limited and Tyagi Portfolio Limited.”

In a bid to further channelise the alleged kickbacks in legitimate financial deals, Bhandari acquired five companies from Himanshu Verma, who has also been named in the FIR. These companies are: Greenpower Marketing and Advertising Private Limited, Bhayana Housing Private Limited (now VRG Housing Private Limited), Bhayana Reality Private Limited (now Stercon Private Limited), Beats Events & Advertising Private Limited and Efficacy Interiors Private Limited. Bhandari subsequently deposited Rs 39.36 crore in the accounts of these five companies with the help of Deepak Aggarwal. Of Rs 39.36 crore, Rs. 5.4 crore was transferred to a company called Saran Savdha LLP owned by Bimal Sareen. Sareen, who has been named in the CBI FIR, is also a director in Bhandari’s firm Offset India Solutions Private Limited.

“There is strong suspicion that the aforementioned cash amount was part of the commission amount paid by the Pilatus Aircrafts to Sanjay Bhandari to obtain the contract from IAF, Ministry of Defence for supply of 75 basic trainer aircraft,” the central investigating agency claimed.

Now, returning to the genesis of probe against Bhandari and Pilatus basic trainer aircraft, the six-page note indicated that the arms dealer’s involvement may not be limited to allegedly swinging the basic trainer aircraft deal in favour of the Swiss company, but may also extend to other deals. It said: “Crores have been spent in these three-day sojourn, specifically companies like AVAANA (owned by Sanjay Bhandari) which is engaged in mission critical system systems and software solutions, development and integration. Its portfolio includes UAVs and asset tracking solutions.” The note also named Bhandari’s Offset India Solutions Private Limited, Micromet-ATI and AVAANA, further adding that under the garb of offset contracts, large amount of commission have been paid via fictitious billing.

Bhandari fled the country in December 2016 and Indian law enforcement agencies believe he is hiding in London. His extradition to India may not only unravel possible links with the then establishment, but also other unholy defence deals he might have orchestrated in connivance with bureaucrats at the helm.

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RTI to BEL on Rs 7900 Cr Scam News published in First Post

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To                                                                                                                        28-04-2019

Mr. Udaya Shankara K S AGM (Marketing)

Bharat Electronics Limited Corporate Office,

Outer Ring Road, Nagavara,

 Bangalore – 560 045

 

Hello,
Kindly provide me with the following information requested under the purview of the Right to Information Act, 2005 in respect  of news series published in First Post Apr 02, 2019 -Bharat Electronics in the dock for  compromising  confidential IAF project, favouring one vendor, BEL s internal inquiry report reveals

 

  1. Whether CVO, BEL investigated and prepared any report on IACCS project for irregularity and compromising   in such national security implementation. Yes or No
  2. If yes, then CVO, BEL submitted report to CVC or CBI or any other GOI agencies. Yes or No
  3. If yes, then provide name of agency and date of submission of said report.
  4. Current status of the report.
  5. Copy of any denial or other written communication provided to First post.
  6. Provide the name of BEL official who recommended the recruitment of  Manish Goyal Manager, NCS-infra

Regards

Prabhu  Dandriyal,
21-Sunderwala, Raipur,

Phone 0135- 2787750, Mobile- 9411114879,
e-mail id prabhudoon@gmail.com  website www.corruptionindrdo.com

PMO, Uncategorized

Vigilance chief recommends action in Rs 7,900-cr IAF project scam, even as BEL’s management hunts down whistleblowers

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Yatish Yadav Apr 26, 2019 – Firstpost

New Delhi: The top vigilance officer in Bharat Electronics Limited (BEL) has recommended action in the Rs 7,900-crore air defence scam uncovered by Firstpost, but it is learnt that the top management has launched a hunt to identify the whistle blowers in a bid to cover up the revelations, which point towards a conspiracy involving BEL officials and private companies including foreign vendors.

The chief vigilance officer (CVO) Shiva Kumar has recommended the blacklisting of the design consultant of the Indian Air Force’s (IAF) sensitive air command and control centres, and action against eight BEL officers for allegedly favouring domestic and foreign companies at the cost of taxpayer money and national security.

The CVO, in the recommendation note highlighting the deep-rooted corruption, has said irregularities in the Integrated Air Command and Control System (IACCS), which started in the UPA regime, were carried out with criminal intent and government rules were flouted in awarding contracts for civil work as well as plant and machinery.

“There were serious violations involving criminal intent through violation of procedure, misrepresentation of facts to management, favouritism to place order on pre-fixed vendors through vested interest, collusion of interest and attempts to make corporate losses. The unit (BEL) has violated MoF (Ministry of Finance), GFR (General Financial Rules) and CVC (Central Vigilance Commission) guidelines while appointment of consultants, contracts for execution of civil works and procurement of items for plant and machinery and various subsystems,” the CVO directives reviewed by Firstpost said.

The comment by the CVO on the role of accused officers clearly indicates the need for not just departmental action but the initiation of criminal proceedings under the Prevention of Corruption Act and other penal provisions as well. A questionnaire sent to MV Gowtama, chairman and managing director (CMD) of BEL, seeking comments went unanswered. Department of Defence Production, Ministry of Defence and the CVC did not respond to a questionnaire sent on 20 April.

However, sources in the CMD’s office revealed there had been no move so far to act on the findings and recommendations of the vigilance department, but a discrete hunt has been launched to locate whistle blowers.

Vigilance chief recommends action in Rs 7,900-cr IAF project scam, even as BELs management hunts down whistleblowers.
“In this regard, top management is penetrating the computer and electronic records of all BEL employees in Bengaluru and Delhi,” sources in the CMD’s office said on condition of anonymity.

Sources quoted above also claimed that the top BEL management went into a huddle after the publication of the Firstpost investigation and subsequent recommendations by the CVO. It is learnt the officials were threatened for reporting massive irregularities in the project to the Prime Minister Office (PMO), defence ministry and the CVC.

The witch-hunt and silence of the BEL management is intriguing despite the CVO categorically pointing out the conflict of interest. The CVO said the design consultant of the highly-sensitive underground automated air defence command and control centres, M/s RD Konsultants should be blacklisted for the fraudulent transactions with BEL.

“Also as the agency (RD Konsultants) was involved in collusion of interest by executing the works through its affiliates, M/s CS Constructions Private Limited through subcontracting from M/s L&T, which has resulted in conflict of interest in the transactions with BEL. Financial penalty to be levied on M/s RD Konsultants as one way of punishment,” the CVO said.

According to sources in BEL’s finance division, since the IACCS project is worth Rs 7,900 crore and directly linked to national security, the audit committee comprising independent directors may recommend a probe by the Central Bureau of Investigation (CBI). The finance division of the defence PSU had raised several objections over the award of contracts flagging rule-books but the officers were overruled by the top brass. Even BEL officer Nataraj Krishnappa, director (other units) had raised objections while processing a certain contract. Sources close to Krishnappa confirmed that a criminal investigation may be on the cards. A CVO is considered the extended hand of the CVC and constitutes an important link between the concerned organisation, vigilance watchdog and the CBI.

As far as the eight accused officers’ roles are concerned, the CVO has observed that disciplinary proceeding including the suspension of an officer working in the infrastructure division (network-centric system), should be initiated for violating procedures and CVC guidelines, which eventually resulted in favor to M/s RD Konsultants.

“It is observed that there was suppression and concealment of facts by the committee in the proposal initiated during 2013 with respect of appointment of a consultant during 2011, for preparation of a preliminary project report. It is pertinent to mention that in the proposal for appointment of consultants during 2011, there is a noting from Senior DGM (Finance) that as per CVC guidelines issued dated 24 June, 2011, if M/s RD Konsultants is hired as a consultant for preparing a preliminary project report, then it cannot be considered for future similar requirements for an IACCS project. Although the proposal was agreed to by CMD, these facts are not brought in the consecutive file raised and the committee have succeeded to give an order on pre-fixed vendor M/s RD Konsultants. Because of concealment of information with regard to previous appointment and delinking of old files and notings, it led to misrepresentation and concealment of facts which resulted in the placing of order with prefixed vendor M/s RD Konsultants, although an open tender has been called for formality,” the CVO note said.

The scathing CVO note also reveals that entire scam was engineered since screening stages in 2011 and 2013. It said that the defence PSU’s committee, comprising officers, constituted to select the consultant did a shoddy job with a clear intention to favour a particular vendor.

“It is observed that the committee during the initial screening has brought down 26 agencies to 14 agencies with shallow scrutiny and with total arbitrariness. After presentations further screening has resulted in qualifying only six agencies. It is pertinent to mention that after presentations, M/s Super Dynamics was disqualified citing only two years turnover against the required pre-qualification of a three-year turnover. However, preferential treatment was given to M/s RD Konsultants. This shows a clear-cut case of vendor favouritism. During evaluation of pre-qualification criteria, the committee had violated the CVC guidelines and the company’s work contract procedures with respect to evaluation of documents submitted by M/s RD Konsultants, non-evaluation of relevant documents pertaining to works completed by M/s RD Konsultants. It appears that wrongful clearance was provided to M/s Konsultants and the committee had facilitated M/s RD Konsultants for pre-qualification by violating the company’s procedures, to place the order on pre-fixed vendor M/s RD Konsultants. The committee during evaluation of pre-qualification criteria had created confused trends by changing the pre-qualification criteria twice without any reason and during such changes, post facto approvals are taken from CMD, forcing the management to committee’s decision,” the CVO observed.

The CVO report has flagged collusion with design consultant and other vendors involved in sensitive air force installations at 10 locations across the country. The report has termed an affiliate as a benami firm, raising suspicion over the role and connivance of BEL officers. The CVO has also attacked the design consultant and BEL management for rigging the confidential contracts.

“The agency M/s RD Konsultants also was involved in collusion of interest by executing the works, through its own benami company M/s CS Constructions Private Limited which has resulted in collusion of interest in the transaction with BEL and capturing both design and execution of project. Under para 4B 3.2.3 of the design and engineering contract, M/s RD Konsultants and his affiliates as well as sub-consultants have been debarred from providing any goods works or service. It is observed that M/s RD Konsultants had violated the contract terms, CVC guidelines by involving in collusion with benami through rigging of contracts. This happened at various levels. The quote by M/s RD Konsultants was nearly the same as that which was estimated by BEL which leads to doubt whether the methodology of estimate was known to M/s RD Konsultants. It is pertinent to mention here that, PK Bhola, then DGM (Marketing-Network Centric System) who was the main resource in BEL for raising all the files and interfacing with customer for the project, joined M/s RD Konsultants after his retirement. This is a matter of great concern,” the CVO has noted.

The corruption in the project being handled by BEL was so blatant that even CCTV footage at the air force’s command and control centres construction site was compromised to facilitate the collusion as evident from the CVO report, which said the surveillance cameras were “not kept in the proper record, which led to non-maintenance of measurement books, subleasing and collusion of parties”.

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BEL allegedly violated string of norms to award contracts to German, Finnish firms; ex-CMD, two retired defence officials under scanner

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Yatish Yadav Apr 09, 2019 – Firstpost

New Delhi: Defence public sector undertaking Bharat Electronics Limited (BEL) handling Indian Air Force’s (IAF) confidential Integrated Air Command and Control System (IACCS) awarded a sub-system contract without floating global tender to a German company Mueller Safe GmbH, which had produced only 75 pieces of valves used for such installation.

Another company Pro Hub Hebetechnik GmbH was also selected by BEL for a contract despite submitting the technical proposal after closing time of bid. A Finland-based company Temet OY was given an award on a single tender basis. Interestingly, Temet OY and Pro Hub Hebetechnik GmbH were already mentioned in a detailed project report of IACCS prepared by M/S RD Konsultants in 2013, raising serious questions over conflict of interest. It is learnt that two BEL officers currently working on IACCS project are also under the scanner of the Central Bureau of Investigation (CBI), which recently received source based inputs regarding their activities.

These facts emerging from documents and BEL’s internal inquiry report raise serious questions that Central Vigilance Commission (CVC) rules and BEL’s own purchase procedures 2016, were allegedly violated in the entire process of the project contracts, which began when the UPA government was in power. As reported by Firstpost on 2 April, BEL has come under the cloud by its own inquiry report for allegedly favouring project design consultant M/S RD Konsultants.

Documents reviewed by Firstpost shows BEL, in the gross violation of purchase procedure, awarded plant and machinery contracts worth hundreds of crores to foreign firms including Temet OY of Finland, Pro Hub Hebetechnik GmbH and Mueller Safe of Germany. No open or global tender was floated to select the vendors. Sources confirmed that the government is likely to ask investigative and enforcement agencies to probe into alleged irregularities in hiring design consultant, the award of contracts for the plant and machinery and role of the serving and retired officers in the process.

After Firstpost mailed a detailed questionnaire to MV Gowtama, chairman and managing director (CMD) of BEL, his office said BEL follows standard procedures, guidelines and its business practices conform to C&AG and CVC guidelines.

“The contracts for any project are awarded through competitive tendering and based on capabilities and capacities of partners/vendors. Hence prima facie BEL does not see any irregularity,” the BEL CMD’s office said.

Temet OY, Finland citing non-disclosure agreement refused to comment on the contract and chose not to respond on working arrangements and details about its association with M/S RD Konsultants. It, however, claimed M/S RD Konsultants was not Temet’s agent.

“We can confirm that M/S RD Konsultants mentioned below is not and has not been an authorised Temet dealer. Of course, if there is an official investigation in progress, we will cooperate with the relevant authorities,” Tero Hanhinen from Temet OY said.

Temet OY though conveniently suppressed the fact that two of its officers, Likka Elias Kivisarri and Adel Velic were accompanied by M/S RD Konsultants’ Vikram Parvathoju to BEL office from 6 to 8 August 2018 for technical discussion with defence PSU officers.

Questionnaire sent to Pro Hub and Mueller Safe, Germany, seeking comments went unanswered. M/S RD Konsultants did not respond to a detailed questionnaire sent on 31 March.

Deal with IACCS design consultant’s foreign affiliates raises a stink

The design firm M/S RD Konsultants in the detailed project report had mentioned that it was working with several foreign companies including Temet OY, Finland and Pro Hub, Germany. The fact has rattled BEL’s internal investigators, who alleged that decision to go with a single vendor is surprising as the design consultant is questionable and requires further probe. The design consultant selected for all 10 sites has total control in the choice of sub-systems like electronic items, building management system and other sensitive hardware. By sidestepping the procurement procedure, BEL did not go for open or global tender for the procurement.

As per BEL purchase procedure para 10.1.7: “Open tenders shall be resorted to in case of non-production/ non project materials estimated to cost Rs 1 crore and above. The time allowed for receiving quotations against open tenders can be fixed, depending upon the geographical area covered, effort required to be put in by the vendors and other relevant factors, however shall not be less than 7 days. In case of global tenders, the notice will also be published in Indian Trade Journal and sent to Indian Missions abroad deemed necessary for adequate response in addition to the press advertisement and BEL website.”

None of these guidelines was followed by BEL in the procurement of equipment of IACCS and the competitive bidding for all 10 operation sites was surreptitiously eliminated and firms directly/indirectly linked with the design consultant were roped in. This is what BEL’s inquiry report had feared. The report mentioned Temet OY, Finland is represented in India by Stahl Tecniks Private Limited, which is directly/ indirectly linked to M/S RD Konsultants. One of the past directors of Stahl Tecniks was Suruchi Totala, who was also director of RD Designs LLP that was floated in 2015 by M/S RD Konsultants partner SK Anand. Now, the RD Designs LLP is in the process of shutting the shop. The BEL’s report also alleges that being the single vendor for all 10 sites, the design consultant carried out works to make sure that it suits the private vendors of plant and machinery of its choice.

“The civil design for the underground structures would have been carried out keeping in mind the various sub-systems to be installed inside. For example, if blast doors of M/S Temet, Finland are chosen that all the openings for the doors would have been designed suiting the doors from Temet. Same would be the case for hydraulic lifts, air conditioning ducts, opening for blast valves etc. Hence either the systems selected by the consultants have to be used or else minor/major modifications would have to be carried out in the civil structure for interfacing any alternate make sub-system. This also substantiates the fact that if minimum two consultants had been hired then at least the two consultants selected would have proposed multiple vendors for the various sub-systems which would have led to healthy competition between various vendors leading to competitive biddings for various sub-systems,” BEL’s internal inquiry report said.

As indicated in the internal inquiry report, after submission of detailed project report, the IACCS contract signed between BEL and IAF had no other choice but to include several of these companies against the requirement with a condition that something equivalent could also be explored. The CVC guidelines are very clear that any purchase order above Rs 1 crore should be concluded through the tendering process and for foreign vendor’s global tender should be floated. The opaque procurement process of BEL was orchestrated in such a way that it gives an impression of a level playing field by exploring other alternatives other than the vendor already mentioned in the detailed project report.

Documents reviewed by Firstpost reveals that a smokescreen was created by constituting a technical committee within the BEL for procurement of plant and machinery for IACCS. On 24 May 2017, BEL chairman and managing director (CMD) MV Gowtama formed the technical panel to explore and identify vendors for the equipment for IACCS complexes (details withheld). This was an interesting turn of event because BEL purchase procedure, 2016, does not mention the constitution of a technical committee to explore, finalise and recommend the vendors. Nevertheless, the technical committee chaired by Umesh Chandra with Pugazhenthi R, BP Pahuja, Subbarao G, Prashant Ranjan Maurya and Udit Agarwal as members were tasked to finalize specifications, identification, shortlisting of original equipment manufacturers/ vendors for supply, finalization of quotation for the equipment and evaluation of suitable make/model for each of the items required for seamless integration with the civil structure of IACCS.

How the contract process was manipulated?

The internal investigation report of BEL gives an indication that the procedures to select vendors for the project was handled through a very simple method of picking the names from the documents submitted by the design consultant, which had prepared a detailed project report mentioning the name of foreign companies it was working with. The project report submitted to BEL was later forwarded to IAF which signed the contract and sent it back to BEL. Subsequently, BEL formed a technical committee to purchase IACCS associated equipment. Thereafter, the technical committee went for shopping at companies first mentioned by M/S RD Konsultants in the detailed project report.

Documents reveal the Finnish firm Temet OY was given the contract for regenerative Carbon Dioxide Removal System for IACCS sites for more than Rs 60 crore without floating global tender. Interestingly, purchase order said that technical committee headed by Umesh Chandra had recommended searching more vendors and two other firms M/S Parker and M/S Airef were explored but both were found not capable of manufacturing Carbon Dioxide removal system with required specifications. Why and how these two companies were selected by the technical committee to explore more option instead of going for an open or global tender remain in the domain of speculation. A BEL officer in the finance division noted in the file that price of the system given to Temet OY needs to be justified since it was on a single tender basis.

“As per company’s policy, the price needs to be justified by technical evaluation or by comparing similar product available in the market not considered for the bidding,” Sanjoy Kumar Pal, senior deputy general manager, finance wrote on 22 August 2018.

There is some interesting observation in the documents, which expose the alleged irregularities. RK Sharma, an officer from the material management division (Network Centric System) gave a contradictory statement in a bid to clarify the pricing based on a single tender. He said price quoted by Temet OY was well below the unit cost considered for the selling price, however, he further went on to say that there was no procurement history of similar items and prices of this system is not readily available in the market.

Subsequently, the technical committee recommended that enquiry for carbon dioxide removal system be sent to Temet OY, Finland only. The proposal was on a single tender basis and Temet OY, Finland was called for technical-commercial negotiations, which was held from 6 to 8 August 2018. Besides BEL and Temet OY officials, Vikram Parvathoju from design consultant M/S RD Konsultants was also present in the meeting.

While appointing the technical committee in May 2017, the CMD, BEL had clearly mentioned that representatives of design consultant, project management consultant and the third-party inspection and certification agency should be involved in the proceeding but neither project management consultants nor officials from third party inspection agency were present in technical and price negotiation meetings. After technical committee recommendation, the single tender proposal was approved.

Just a day after the committee meeting on 8 August 2018, which was attended by senior BEL officers including Joydeep Majumdar (General Manager, Network Centric System), BP Pahuja ( Assistant General Manager, Infrastructure, Network Centric System) and two representatives of Temet OY, the defence PSU started placing the purchase order for Temet OY, Finland. The total quantity of carbon dioxide removal system (details withheld) is mentioned on the 20 August 2018 note, which further said, “The total quantity was indicated by Infra group based on the design and requirements finalized by design consultant M/S RD Konsultants.”

“Technical committee recommended that enquiry for Carbon Dioxide Removal System be sent to M/S Temet OY only. The proposal is on a single tender basis,” the note said.

German company favoured despite submitting the technical proposal after closing time

Another foreign company under the cloud is Pro-Hub Hebetechnik GmbH based in Germany that was awarded the multi-crore contract of goods lifts for the IACCS project. The company was mentioned by M/S RD Konsultants in the detailed project report submitted during the UPA regime. M/S RD Konsultants had claimed that it provides design consultancy to the Pro Hub Hebetechnik GmbH. This issue has been raised in the internal investigation report of BEL, recommending further probe to ascertain conflict of interest.

Satyaprem from M/S RD Consultants was present in the technical meeting on 16 July 2018 between officials from BEL and Pro Hub Hebetechnik GmbH. No representatives from the project management consultant and third-party inspection and certification agency were present in the meeting. Documents reviewed by Firstpost shows technical committee had selected two companies for goods lift — Pro Hub Hebetechnik GmbH and M/S Maspero Elevatori.

Documents reveal that Pro Hub Hebetechnik GmbH technical response vide 11 emails were received on 26 June 2018, after the closing time of bid. However, it was not disqualified. This move triggered suspicion among the BEL officer’s ranks and Sanjoy Kr. Pal, Senior Deputy Manager, Finance division, BEL on 26 July 2018 objected the move. He questioned on the proposal file for awarding the contract to Pro Hub Hebetechnik GmbH asking as to why late tender is being entertained and why purchase clause is not being followed in this case.

“The proposal is put up to CMD under what Sub Delegation of Powers (SDOP) clause? As per clause 10.2.7 of the purchase procedure, no late tender should be entertained. Why purchase procedure clause was not followed? Pal questioned.

On 27 July, RK Sharma, deputy general manager, Material Management (Network Centric System), BEL clarified that since the happenings and the facts related to the receipt of bids after closing time are in variation of the actually prescribed process in purchase procedure 2016, approval is sought of CMD for the process followed by Strategic Business Unit (SBU) of BEL. He further said that Pro Hub Hebetechnik GmbH was not disqualified because a ‘conscious decision’ was taken by the SBU, keeping in view the project requirements.

Sanjoy Kumar Pal, BEL officer from finance division, however, was not satisfied with the clarification and he clearly said that proposal was in violation of purchase procedure.

“The proposal is in deviation of purchase procedure and accordingly it is put up to CMD,” Pal wrote.

Despite the proposal contested by his own officer in finance division, CMD MV Gowtama approved the proposal on 27 July 2018.

Technical capability? Produced just 75 valves but selected by BEL

Another deal that has come under the scanner is blast valves, gastight valves and wall sleeves for the IACCS sites. The contract has been awarded to German company Mueller Safe GmbH, which primarily deal in safe and very recently ventured into valve manufacturing and till May 2018 had only produced 75 pieces. On the other hand, a UK company, European EMC Products Ltd (EEP), which had produced and supplied more than 2,000 valves was simply disqualified on the basis of not meeting the criteria for average annual turnover for last three years, which was vigorously contested by BEL officer Nataraj Krishnappa, Director arguing that EEP is technically suitable and competent.

“M/S EEP, UK has been dropped based on the criteria that annual turnover of the company for the last 3 years does not meet the desired requirement. This vendor is technically suitable and competent. Why cannot they be considered for Request for Quotation (RFQ) purpose? The site visit report of the committee does not indicate any reason for the disqualification of the vendor,” Krishnappa wrote on 28 May 2018.

Joydeep Majumdar, general manager (Network Centric System) wrote that the technical committee felt EEP being a small organisation with low turnover will not be able to handle contract estimated to be worth Rs 200 crores. Subsequently, the EEP, UK was dropped and instead of going for global tender, Request for Proposal (RFP) on the restricted tender basis was sent to Mueller Safe GmbH and Temet OY, a world leader in valve business, which had supplied more than 60,000 valves till May 2018 globally.

The bid was invited on 15 June 2018 and while the response from Temet OY was submitted before the expiry of bid submission time, Mueller Safe GmbH bid was received after closing time. Subsequently, Mueller Safe GmbH, which had no expertise in manufacturing valves was declared L1 and it was called for techno-commercial negotiations, which were held from 9 to 14 July 2018. Questions were raised within BEL as to why Mueller Safe, an inexperienced company in making valves, was given contract and why not re-tendering process inviting more companies was initiated by the BEL.

Documents reviewed by Firstpost reveals that an officer in the finance division had warned just before the finalisation of the contract to Mueller that “selection should be as per the technical manufacturing capability”. But, that was ignored. Even after Mueller Safe GmbH was awarded the contract, Naresh Kumar, deputy general manager of the finance division, BEL said that the bid of M/S Mueller Safe GmbH is received after the closing time and approval for bid acceptance received after closing time requires CMD approval. Another officer V Muralidharan, General Manager (Finance) also flagged the concerns on 26 July 2018 that since the proposal was accepted after the closing time of bid, CMD post facto approval of deviation would be required. The proposal was approved by the CMD on 27 July 2018.

Documents reviewed by the Firstpost also revealed Mueller Safe GmbH was not mentioned in the RD Konsultants documents and thus it appears that no representatives from the design consultants attended the meetings. No one from the project management consultant and third-party inspection and certification agency was present either. Also, the meetings held between 11-12 July 2018 at BEL office with the Mueller Safe GmbH functionaries had not representatives from the above-mentioned group.

It is further learnt that original equipment manufacturer for valve refused on Transfer of Technology (ToT) arguing that its business will be adversely affected in the case full know-how is given to BEL as defence PSU will become the competitor in the market. The technical committee agreed upon partial ToT and gave its go-ahead for the contract.

The BEL internal inquiry report has recommended further probe into the installation of the sub-systems of IACCS observing that site design might be designed keeping a particular company in mind.

“It is also claimed that ‘M/S RD Konsultants’ has designed the underground RCC structure taking into consideration a particular make of doors, hatches, blast valves, lifts, air conditioning, building management systems etc. All the reinforcement, cut-outs etc in the RCC structure were designed for interfacing with the particular brand (example for the doors the steel reinforcements in the opening were designed as per the hinge locations in the particular band of blast doors). Since the RCC structures have been made at many sides even before the finalization of the sub-systems to be installed hence it needs to be studied what was the repercussion in the change in scope of RCC structure already built and what was the cost repercussion BEL had to bear,” the internal inquiry report said.

Similarly, the order for radio and its accessories worth more than Rs 9 crore, was also given to a Germany based company (details withheld) on a single source basis without inviting tender. It appears this German firm selected without tendering process was not the original manufacturer. A key document reviewed by Firstpost said, “The firm indicated that most of the hardware being delivered by them is third-party hardware.”

IACCS prototype makers joined fugitive arms dealer Sanjay Bhandari firm

It is learnt that two senior officers of defence PSU, BEL, who were instrumental in designing prototype for Indian Air Force’s confidential IACCS project in 2007 joined fugitive arms dealer Sanjay Bhandari’s firm OIS Advanced Technology Private Limited after retirement in 2011. Interestingly, BEL was preparing to formally launch the IACCS project by inviting preliminary project report for 10 automated air operation centre for Indian Air Force around the same time. The two officers, who joined arms dealer’s company at senior positions, are now under the scanner of Enforcement Directorate (ED), which is probing alleged kickbacks linked to Bhandari in Swiss basic trainer aircraft Pilatus during UPA regime in 2012. Incidentally, BEL is the offset partner of Pilatus.

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How a CAG report exposed DRDO’s mishandling of AEW&CS programme

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The CAG report showed irregularities in the selection of aircraft for the programme

By Pradip R Sagar August 29, 2018

Indian Air Force’s indigenous AEW&CS in action during ‘Exercise Iron Fist’ in Pokhran | PTI

THE WEEK

As the indigenous Airborne Early Warning and Control System (AEW&CS)—aircraft fitted with a radar system—flew over the Rajpath during the 2017 Republic Day parade, India joined an elite group of five countries that had this capability. But, before it could be formally inducted into the Air Force fleet, the ‘Eye in the Sky’ has flown into turbulence.

A report by the Comptroller and Auditor General, which was recently tabled in Parliament, has made startling observations about the programme, on which the Defence Research and Development Organisation has spent more than Rs 2,500 crore.

The CAG report showed irregularities in the selection of aircraft for the programme. The auditor slammed the DRDO for the cost overrun—the initial cost was Rs 1,800 crore—and its claims about indigenousness. Moreover, preferred vendors were selected to benefit certain companies, said the report. Though the Air Force had accepted the AEW&CS last year, it is yet to get the final operational clearance.
The AEW&CS is a moving surveillance platform, making it difficult for the enemy to locate the exact position of the aircraft. With its long range and detection capabilities, it gives a 360 degree view of the sky and can track many aircraft simultaneously.

China currently has 20 such airborne warning systems, while Pakistan has eight. The Indian Air Force has only three—Israeli Phalcon radar systems mounted on Russian IL-76 aircraft. India had bought the radar systems from Israel in 2004. According to experts, India currently does not have the capability to cover its entire airspace during a war.

A programme to develop an indigenous early warning system was taken up in 1994, but was shut down after a fatal crash. Subsequently, the defence ministry in 1999 approved the import of three airborne warning systems (the ones from Israel) and decided to meet further requirement through indigenous development.

In October 2004, the cabinet committee on security approved indigenous development of AEW&CS at a cost of Rs 1,800 crore. The deadline was April 2011. Under the project, two AEW&CS were to be supplied to the Air Force. DRDO’s Bengaluru-based laboratory, Centre for Air Borne Systems (CABS), was the nodal agency for design and development.

Considering the operational importance of this project, the CAG carried out an audit to know whether the system had everything that was promised. K. Subramaniam, principal director of audit, Air Force, recently sent the classified report to Dr S. Christopher, the then secretary of the Department of Defence Research and Development—which found serious irregularities in the programme.

The report has come down heavily on the programme over its claim of indigenousness. Despite the project being called home made, it was only 48 per cent indigenous. The DRDO had claimed it to be 81 per cent. And, the cost of foreign consultancy, about Rs 106 crore, was categorised as indigenous.

The CAG’s observations draw strength from the ongoing CBI investigation into alleged kickbacks in the process of selecting the aircraft. The Embraer EMB-145 aircraft from Brazil was shortlisted for the project in 2007. However, Brazilian media reported that Indian officials were bribed to swing the deal in Embraer’s favour. In 2016, the CBI registered a case against NRI arms dealer Vipin Khanna and two private companies based abroad. The case was about the alleged payment of more than $5.70 million as kickbacks to seal the deal for the aircraft.

The CAG report also pointed out inadequacies in management, which stretched the development period to 13 years. “And, the operational requirements, instead of being based on the functional needs of the Air Force, were being adjusted according to the aircraft that was ‘pre-selected’. It took seven years to finalise the operational requirements,” said the report.


During the design and development stage, some operational parameters were compromised because of the Embraer’s limitations. Also, there was no competitive bidding while selecting the aircraft. The Embraer was shortlisted through a nomination. Notably, several aircraft, such as the IL-76, and models from Gulfstream, Bombardier and Boeing were available at the time.

“The justification given for the selection of EMB-145 was not tenable,” the CAG observed. “No objective assessment of the merits and demerits of available options was done. The selection of EMB-145 was arbitrary and based on preconceived preference.”

Initial operational requirements stipulated that the system should be able to operate from high-altitude locations like Leh to have a much deeper view into the Chinese army’s activities. As the EMB-145 was incapable of doing so, claims the report, the Air Force had to drop this requirement in February 2006.

The report also said that the Air Force officials working with the DRDO reiterated that Embraer was not the suitable aircraft.

The CAG also criticised the project for the way the pilots were trained. “From the scrutiny of the expenditure on training, the audit found that the training commenced in June 2007. At this point, the procurement contract for EMB-145 was yet to be awarded and negotiations were underway between the CABS and M/s Embraer. Therefore, training of pilots on an aircraft even before finalising its purchase is highly unjustified,” CAG pointed out. Six pilots were trained abroad at a cost of Rs 23 crore.

Of the 18 requirements specified by the Air Force, AEW&CS could not fully achieve ten important ones. Despite this, the Air Force accepted the first system in February 2017.

“Since EMB-145 was selected, the weight of the mission system had to be adjusted to the optimum payload capacity of EMB-145, which was 3,000kg. The radar along with its associated systems, which was to be mounted on the fuselage, had to be limited to 1,500 kilos due to structural limitations,” the CAG said.

The probable date of completion was revised four times and the final date of completion was extended by over six years, said the report. The Air Force kept changing its requirements. In the middle of the programme, the Air Force demanded air-to-air refuelling and a de-icing system. It led to a delay of nearly two years.

Christopher, who was the head of CABS, said the repeated modifications in the operational requirement by the Air Force played a major role in the delay of the project. “It is all recorded in official documents and no one can find fault with me for it,” he said. “However, I believe that operational requirements is a prerogative of the user and you, as a developer of the equipment, cannot challenge it.”

Regarding the aircraft, he said, “Embraer was a well-proven aircraft. The decision to buy Embraer was taken in consultation with the then IAF chief S. Krishnaswamy. Four countries were using this platform as AWACS—the generic term for such a system. Moreover, the IAF decided that it has to be a turbo jet, not propellant. Turbo engine gives them the desired speed and efficiency.”

When contacted, Krishnaswamy said the selection of aircraft was purely DRDO’s decision. “The IAF was using Embraer for its VVIP fleet and thought of commonality if it is selected for AEW&CS. Since AEW&CS was DRDO’s project and budget was allocated to them, the final decision for selecting aircraft was DRDO’s only,” he said, adding that any modification in the operational requirements was a collective decision of the Air Force and the DRDO.

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Army whistleblower alleges harassment

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Prateek Goyal – Saturday, May 26, 2018, 8:12 PM Sakal Times

“According to sources in Army, Dubey was shunted for reporting the security breach to Army Headquarters and CBI”

Pune: In a classic case of harassment of a whistleblower, who had exposed a security breach, the office of an Army officer was sealed on the orders of a high ranking Army official.
Earlier, on March 13, 2018 Sakal Times had carried a report that said the CBI was going to probe a Major General’s role in a security breach at VRDE.

As per the latest development, Lt Colonel NK Dubey found his office at the Ahmednagar-based DRDO’s Vehicle Research & Development Establishment (VRDE) sealed at around 5.30 pm on Tuesday evening. A letter was issued to him half an hour later, stating that Major General Ajay Gupta, Director of VRDE, has transferred him to the National Centre for Automotive Testing.

Despite the ongoing CBI inquiry against Gupta in the security breach matter, he was recently given an extension after completing two years at VRDE through an order issued by Secretary DD R&D and Chairman of DRDO Dr S Christopher on May 18, 2018. Surprisingly, within a two working days of this order, Gupta shunted Dubey out of his office.

According to sources in Army, Dubey was shunted for reporting the security breach to Army Headquarters and CBI. Dubey reported about a 30 minute meeting conducted by Gupta on February 15, 2018 with two foreign nationals and a non-resident Indian, along with officials of a private company, without taking clearance from the Directorate of Vigilance and Security, New Delhi, as is mandatory for DRDO officials.

Earlier, Dubey reported the security lapses at VRDE, including inadequate guard posts, unavailability of QRT vehicle, unavailability of routes to do perimeter patrolling, inadequate boundary lights, etc. to DRDO, after which a letter dated May 22, 2017 was written by Gupta to Army HQ to transfer Dubey. The Army headquarters, however, refused to do so. (Army HQ letter available with Sakal Times)

A source said, “Lt Colonel Dubey have been targeted for exposing corruption and corrupt practices. Previously also, in 2017, Major General Gupta kept him out of office for around two months despite Army HQ refraining him from doing so.” Source added that Gupta had received the letter on June 12 from Army HQ, but he sat on it till August as it was demi-official (person to person). Source said that due to this, Dubey could join back only in August after being informed by Army HQ about the letter. Sealing the office of Dubey and posting him out is an act of revenge against him for being a whistleblower in a number of previous cases against Gupta.

It is significant to note that in 2015, dozens of complaints were reported against Gupta for his deliberate acts and omissions of misconducts under CCS (Conduct) Rules 1964 and under the Army Act, criminal misconduct amounting to corruption under the Prevention of Corruption Act, 1988 and criminal offences under IPC to then defence minister Manohar Parrikar. Gupta, then the Director of Vigilance and Security, DRDO HQ, New Delhi, was removed from his post and transferred to the office of Director General, Aeronmautical Systems, Bengaluru.

When questioned, Gupta said, “He (Dubey) is being relieved because there is an investigation against him for leakage of information which he was holding and gave to an unauthorised person outside the lab. Somebody has asked us to conduct an inquiry. He may influence the investigation and hence, he is being posted out.”

Responding to questions that Gupta sat on the Army HQ’s order overruling his decision to transfer Dubey, Gupta said, “DRDO is not under Army, DRDO is an independent organisation, which runs on the basis of its own rules and regulations. If the Army has posted him here, then there is a particular procedure which has to be followed as per DRDO rules. Even DRDO has written to the Army to post him back, I don’t know why the Army is not posting him back.”

When questioned about the VRDE security breach and complaint to CBI, Gupta replied, “I don’t know what you are talking about. I don’t want to talk further.”

 

 

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Army Two Star General made mockery of Indian Army’s reputation in DRDO

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To                                                                                                           27th March 2018

General Bipin Rawat,

Army chief

Army Headquarter, South Block,

DHQ P.O, New Delhi 110011

Subject: Army Two Star General made mockery of Indian Army’s reputation in DRDO.

Sir,

In the name of Services Interaction, DRDO has service officers from all three wings of the armed forces. The officers are posted on a tenure basis.

It is observed that in DRDO more than 90% services officers are assigned logistic/ administrative jobs like Security Officer, Motor Transport Officer, Estate Manager, Material Management and managing scientists officers mess/canteen requirements, etc.

Some smart services officers who are involved in DRDO’s scientists’ bluff game are able to get permanent absorption in the organization and enjoy services as well as the scientist sticker.

But sincere services officers face a lot of embarrassment from the corrupt scientist herd. They face unprecedented transfers in their short tenure, negative remarks on their service records only because they perform the job assigned honestly. For all these unfair means DRDO takes help of senior services officers who are permanently absorbed and are enjoying all kinds of benefits along with the corrupt scientists.

Since the last 30 years, DRDO has not been able to quote a single services officer who has contributed to any remarkable technical contribution to the nation through DRDO (except the services doctors).

The important part of these absorbed services officers is that they are promoted unduly without contribution to the nation or services. Only thing that they protect are the bluffers.

Only one example to prove the aforementioned is Maj. Gen. Ajay Gupta, present Director, VRDE, DRDO, Ahmednagar. If anyone sees his journey in DRDO, he will know how blessed the Maj. Gen. is because of saving culprit scientist as long as he was serving tenure as Director Vigilance, DRDO, HQ. Of the hundreds of complaints filed, he stopped or delayed multiple cases. This reveals the truth about how corruption flourishes in DRDO with the help of service officers.

Maj. Gen. Ajay Gupta, present Director, VRDE, DRDO, Ahmednagar made mockery of Indian Army reputation on 15th February 2018.

As reported by Sakal Times “CBI to probe Major Gen’s role in security breach at VRDE” March 14, 2018”

It is a very serious matter that active Army Maj. Gen, who was earlier served as Director Vigilance & Security. DRDO HQ for long tenure did this misadventure.

As per Sakal Times “When contacted, Maj Gen Gupta said, “I did not conduct any meeting with those foreign nationals. They came to VRDE without any clearance, which is why I went to the gate to turn them back.”

Above statement of Maj Gen Gupta is totally wrong because as per evidences for telling no for meeting he can pass the massage through Security or if he wants to say no personally, how come conveying the same took 30 minutes. 

15th Feb 2018 Dhound Gate, VRDE, DRDO, Ahemadnagar

Foreigners reached at Dhound Gate, VRDE, DRDO, Ahemadnagar-           10:29:56

Director reached in his flag car at Dhound Gate, VRDE. Ahemadnagar-    10:33:12

Something dumped in Foreigner’s vehicle without security         –              10:44:44

Director back in his flag car from Dhound Gate, VRDE Ahemadnagar-      11:00:43 

Maj. Gen spend time with two foreign nationals almost                  –  27.31 Minutes

Second one most important evidence not highlight in news clip that is at 10:44:44 hrs, 15th Feb 2018 Cam – 3 of Dhound gate recorded that some stuff was dumped in foreigner’s white car by VRDE personals, Maj Gen Ajay Gupta was present there  in meeting with foreign national.(Evidence – 12)

As per CCTV recording one local vehicle dealer was present in above said meeting as per sources he was only organized the meeting which itself explanatory that Maj Gen Ajay Gupta very much involve personally with vendors/dealer etc.

Therefore, for the clean reputation of Indian Army a serious inquiry is needed, CBI, IB, MI are have their own course but Army Headquarter should deal this matter in high level. Because the Maj Gen Ajay Gupta approached DRDO Hqrs to send a denial to media on this issue fortunately it did not work since Maj Gen Ajay Gupta was enjoying the post of Dir. Vig & Security for a long time and have lot of inputs of wrong doings of high level DRDO official so he will try to bury the incident and influence the enquiry.

As a citizen of India and tax payer I request you to take appropriate action on above said incident and set exemplary precedent for service officers who are serving in DRDO and working against national interest. Hope we will soon be able to see our grate army practice to dealt such serious security/corruption matter which can dent our national interest

With great hope, Jaihind

Regards

Prabhu Dandriyal,

21-Sunderwala, Raipur,

Dehradun-248008

Phone – 0135-2787750 | Mobile – 9411114879

Email – prabhudoon@gmail.com | website – www.corruptionindrdo.com

 

Enclosed:  recorded evidence of incident

 Copy to

  1. Smt Nirmala Sitharaman, Defence Minister, 104- South Block, New Delhi-110011
  2. Additional Directorate General of Public Information (ADGPI), Indian Army Hq Of MoD, South Block, New Delhi -110011