It's been a bad month for the shadowy world of arms dealers in India. Vipin Khanna, one of the top names in the defence acquisition industry for his role in the several defence deals, has been booked by the CBI in the $209 million Embraer aircraft deal.
Earlier, Sanjay Bhandari, another arms dealer, whose Offset India Solutions saw a phenomenal rise in the last seven years, was booked by the Delhi Police under the stringent Official Secrets Act. The week before, a newspaper reported how Sudhir Choudhrie, another top arms dealer, figures in the Panama Papers, the expose that detailed offshore accounts. He, too, has been the focus of several probes earlier. Both Bhandari and Khanna are well connected with the Congress party, according to several accounts.
The CBI says Khanna, who like Choudhrie, operates from London, received a kickback of $5.6 million for reportedly clinching the deal with a Brazilian company to supply three Embraer-145 aircraft to the Indian Air Force in 2008. While two aircraft were delivered in 2012, the last one came in 2015, after several missed deadlines. The DRDO had signed the contract with Embraer to build indigenous Airborne Early Warning and Control Systems for the Indian Air Force.
What the CBI found
The CBI had instituted a preliminary inquiry in September 2016, which was converted into an FIR on 18 October, after it managed to unearth the source and the destination of the alleged kickbacks. These had been flagged by the US Justice Department, which is probing Embraer's dealings with several countries, including India.
According to reports, the FIR states Khanna received kickbacks through a Singapore-based company, Interdev Pte Ltd, which were routed in three tranches via a subsidiary of Embraer. The payoffs, CBI claims, went through Austria and Switzerland.
The CBI has issued a look-out circular against Khanna, who is said to be in India currently.
The Khannas' shady past
The 86-year-old Khanna is not a new entrant to the CBI's list of suspects. Considered to be close to former External Affairs Minister Natwar Singh, Khanna and his son Aditya were under the arc of investigations in the oil-for-food scam, which forced Natwar's resignation from the UPA government.
Then, after Aditya managed to flee to the UK, giving Indian investigators the slip, his father was stopped by immigration authorities when he, too, tried to escape to London, in April 2006. His passport was impounded by the Enforcement Directorate.
During the same period, Khanna was also under investigation for alleged kickbacks to the tune of Rs 59 crore in the Barak Missile deal with Israel. The deal was later scrapped over allegations of corruption, which included the name of former Defence Minister George Fernandes.
The CBI had also charged his other son Arvind Khanna, then a Congress legislator in Punjab, for receiving foreign contributions to the tune of Rs 7 crore from entities based in the UK. This was in contravention of FCRA provisions, which mandate that prior approval be taken from the Centre before accepting any such funds.
The CBI had then, reportedly, suspected that the foreign contributions were linked to defence kickbacks.
Khanna and another agent, Moninder Singh Sahni, were also part of the probe into a deal for 1,200 bunker buster guns from South Africa's Denel in 2005. The CBI had later filed a closure report in the case.
When it comes to such high-profile corruption cases, the agencies have a difficult time establishing the trail of alleged kickbacks. Only on Thursday, CBI chief Anil Sinha had said how the agency had 392 investigations pending in 66 countries.
Edited by Shreyas Sharma
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