Barak deal: CBI books Fernandes, Jaitley

The CBI today booked former defence minister George Fernandes and his associate Jaya Jaitley for allegedly receiving Rs 2 crore in the deal for the Barak missile systems from Israel in 2000. An FIR has also been registered against former Navy chief Admiral Sushil Kumar.

This follows a Tehelka expose, which was referred to the CBI by Defence Minister Pranab Mukherjee along with some other controversial defence deals.

Fernandes denied the charges. "In so far as Barak is concerned, if they have to make any charge, they should start with the President, who first called for the system before I joined the government," he said. Kalam was then the scientific adviser to the defence minister.

Fernandes said Congress chief Sonia Gandhi was "behind the Tehelka sting operation and wanted to implicate me. This is the handiwork of that lady." He said he did not fear arrest.

The FIR, filed in a court yesterday, alleged that Rs two crore was paid to Jaitley, who acted as an "agent" for the Rs 1,150-crore deal for seven Barak anti-missile systems from Israel Aircraft Industries. Jaitley was then the president of Fernandes' Samata Party.

The CBI has accused RK Jain, the then Samata treasurer, of receiving money while Kumar has been accused of "colluding with other accused to put up a note" to Fernandes to import the systems despite objections from the Defence Research and Development Organisation. Fernandes has also been accused of getting the proposal approved by the Cabinet Committee on Security (CCS).

The FIR is almost a word-by-word repeat of the charges in the Tehelka tape, which shows Jain as saying that he passed on Rs 1 crore to Fernandes to expedite the deal. The defence ministry is accused of going against the advice of the DRDO, headed by Kalam, which wanted the Navy to go for the Trishul missiles saying the Barak system was twice as expensive.

After the expose, Fernandes had said the DRDO was involved in the selection and the first contract was concluded in 1997 when Admiral Vishnu Bhagwat was the Chief of Naval Staff. But independent research suggested that Bhagwat had given assent to the import of only one system. The Trishul was not available then.

However, after Bhagwat's dismissal and taking over of Kumar, the defence minister ordered six more systems. Fernandes said the decision was taken after consultations with the DRDO and the Navy. However, a section of the Navy is of the view that the system is not designed to tackle supersonic anti-ship missiles, which may be a major threat in the years to come.

The FIR was lodged after the CBI raided houses of several defence dealers including Sudhir Chaudhary, who was allegedly involved in clinching the Su-30 deal with Russia, and Vipin Khanna, whose son Aditya was allegedly linked to the oil-for-cash deal with Iraq.

Sources in the armament industry said Khanna was a small dealer but the Chaudhary family dealt with Russia and Israel and their group was worth "thousands of crores."