The Central Bureau of Investigation (CBI) has filed a first information report (FIR) against Rolls Royce Plc, Rolls Royce India Pvt Ltd, Ashok Patni, Director, M/s Aashmore Pvt Ltd, Aashmore Pvt Ltd, M/s Turbotech Energy Services International Pvt Ltd, other unknown officials of HAL, ONGC and GAIL and others in a case of criminal conspiracy and corruption charges related to purchase orders.
The case has been registered "under Section 120B (criminal conspiracy) of the Indian Penal Code (IPC) read with 7, 8 and 13(2) read with 13(1)(d) of Prevention of Corruption Act, 1988 against M/s Rolls Royce Plc, M/s Rolls Royce India Pvt Ltd, Ashok Patni, Director of M/s Aashmore Pvt Ltd, M/s Aashmore Pvt Ltd, M/s Turbotech Energy Services International Pvt Ltd, other unknown officials of HAL, ONGC and GAIL and others."
According to FIR, "the total value of purchase orders placed on Rolls Royce by IMGT division of HAL during the period from 2005 to 2013 is of Rs 286.55 crore. In addition, the Engine Division of HAL, Bangalore, during the period from 2000 to 2013 has also placed purchase orders on M/s Rolls Royce to the tune of Rs 4,455.92 crore," reads the CBI FIR.
"There is likelihood that M/s Rolls Royce may be engaging M/s Aashmore Pvt Ltd on payment of commission in other purchase orders and part of this commission paid by M/s Rolls Royce to M/s Aashmore Pvt Ltd may have been paid as kickback to unknown officials of HAL involved in the procurement process as the total business of HAL with Rolls Royce in recent years is in excess of Rs 4,700 crore," further reads the FIR.
Indian Marine Gas Turbine (IMGT) division of HAL is engaged in overhaul and repair of Avon and Allision Engines from its customers ONGC and GAIL respectively. The procurement of spares for Avon engines and Allison engines were made from energy division of M/s Rolls Royce Plc.
"Energy Maintenance, Repair and Overhaul Center (EMROC) Agreement was executed between Rolls Royce Power Engineering Plc and HAL in June 2007 and was valid up to December 31, 2011. Vide this agreement HAL provided maintenance repair and overhaul services for the units owned by the GAIL and ONGC under above licence from Rolls Royce," says the FIR.
"In order to perform these services, HAL had to purchase spare parts and engineering services from Rolls Royce. HAL being Maintenance Repairs Overhaul Centres (MROC) issued purchase orders to M/s Rolls Royce to procure spare part, component/module or their items," adds the FIR.
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According to FIR, dated July 29, 2019, the conditions of purchase order specifically mentioned that Rolls Royce is not supposed to appoint any agent in India to promote this contract and no commission is payable to such agent.
As per the FIR, the CBI inquiry revealed that Rolls Royce engaged M/s Aashmore Pvt Ltd through its Director Ashok Patni as Commercial Advisor by means of Commercial Advisor Agreements (CAAs) in India during the period from 2007 to 2011 by violating the term and conditions of Purchase Orders (POs) and Integrity Pact (IP) between Rolls Royce and HAL.
"M/s, Rolls Royce paid commission @ 10 per cent to 11.3 per cent to M/s Aashmore Pvt Ltd in supply of spare parts pertaining to the Avon and Allison Engines on licensor basis and the commission amount comes to the tune of Rs 18.32 crores (approx) during the period from 2007 to 2011 w.r.t 100 purchase orders," FIR reads.
The FIR states that M/s Rolls Royce declared before HAL and ONGC in December 2013 about Ashok Patni and his company M/s Aashmore Pvt Ltd as commercial advisor of M/s Rolls Royce with regard to its transactions with HAL for the period 2007-2011.
"Enquiry revealed that M/s Rolls Royce paid above the commission of Rs 18.32 crore to M/s Aashmore Pvt Ltd during the period 2007-2011. M/s Rolls Royce entered into an illegal contract with M/s Aashmore Pvt Ltd by engaging it as commercial advisor for India by means of CAAs and made an illegal commission payment to it whereas M/s Rolls Royce was not supposed to engage the services of intermediary/third party in supply of material/spare parts to HAL as per conditions enumerated in Purchase Orders and/or Integrity Pact," FIR states.
It has been alleged in the FIR that Rolls Royce engaged the services of Ashok Patni and his company M/s Aashmore Pvt Ltd in order to conceal the "illegal payments" made to Aashmore Pvt Ltd as "commission".
"Enquiry revealed that M/s Rolls Royce engaged the services of M/s Aashmore Pvt Ltd, Singapore through its Director Ashok Patni as a commercial advisor in the procurement of spare parts/materials by violating the conditions of guidelines/Integrity Pact between Rolls Royce and ONGC... M/s Rolls Royce had paid commission to M/s Aashmore Pvt Ltd to the tune of Rs 29.81 crore in 73 Purchase Orders during the period from 2007 to 2011 for the procurement of material/spare parts pertaining to the engines," FIR reads.
According to FIR, Rolls Royce did not declare the appointment of Ashok Patni and his company Aashmore Pvt Ltd at the time of bid/tender.
"It is further alleged that during 2008-2009 M/s Rolls Royce engaged M/s Turbotech Energy Services International Pvt Ltd (Turbotech) in Vijaypur, Dadri, Bawana Pipeline Project, and declared 2 pc commission on bid. Whereas during 2008-09 M/s Rolls Royce also engaged the services of another company M/s Infinity owned by Ashok Patni in above Vijaypur, Dadri, Bawana Pipeline Project by violating the condition of Integrity Pact with GAIL and made 2 pc of extra payment to M/s Infinity for project management services in connection with the above project," reads the FIR.
"It is also found during the enquiry that M/s Aashmore Pvt Ltd along with another concern related to Ashok Patni namely M/s Turbotech Energy Services International Pvt Ltd made payments of Rs 10 lakh as donation to a cooperative society of ONGC, namely, ONGC Officers Mahila Samiti, which was unethically accepted by the aforesaid society."
The FIR states that Aashmore Pvt Ltd did not provide the details of bank accounts in which the commission was received.
"During the enquiry, several requests have been made to Aashmore Pvt Ltd for providing bank details, in which commission was received from Rolls Royce but the details were not provided by Aashmore Pvt Ltd to CBI due to non-cooperation. The above act of non-cooperation prima facie shows that Aashmore Pvt Ltd is hiding the corrupt public servants of HAL, ONGC, and GAIL involved in the process of procurement and illegal gratification," adds the FIR.
According to FIR, there was a conspiracy by Rolls Royce Plc and its subsidiary M/s Rolls Royce India Pvt Ltd to misrepresent the facts before ONGC and GAIL regarding the engagement of agent in order to win the contract with ONGC and GAIL due to deception by Rolls Royce.
"In view of the above, prima facie there appears commission of offences punishable under Section 120B of IPC r/w 7, 8 and 13(2) r/w 13(1)(d) of PC Act, 1988 against M/s Rolls Royce Plc, M/s Rolls Royce India Pvt Ltd, Ashok Patni, Director of M/s Aashmore Pvt Ltd, M/s Aashmore Pvt Ltd, M/s Turbotech Energy Services International Pvt Ltd, other unknown officials of HAL, ONGC and GAIL and others," says the FIR.
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