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India to ‘pursue all options’ to recover bank guarantee

Posted On : 2014-03-18 04:58:38
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News Type: General ;

Synopsis

India will file an appeal against the Milan court order for the encashment of bank guarantee.

India has reacted sharply to the order of an Italian court, which rejected a bid to recover the bank guarantee worth over 278 million euros in connection with the AgustaWestland chopper deal. The government has decided appeal against the court order.

In a press release issued on Tuesday, the government said that India would file an appeal against the Milan court order for the encashment of bank guarantee. It also said that India would “vigorously pursue all options” to encash the amount.

India has already encashed bank guarantees of around Rs 240 crore deposited in banks in India but it is yet to recover the bank guarantees deposited in banks of Italy.

An Italian court in Milan on Monday accepted a plea by AgustaWestland’s parent company Finmecannica to stop India from encashing over Rs 2,360 crore (Euro 278 million).

“With this measure, the Court granted the requests made by the companies of the Finmeccanica Group, recognising the manifestly abusive enforcement of the guarantees made by the Indian Defense Ministry, given the vagueness of the complaints made in relation to alleged breaches of contract,” Finmeccanica said in a statement. “The Milan court has confirmed the ruling made last January, prohibiting…the payment of collateral of more than 278 million euros deposited in relation to the contract,” it said.

The Defence Ministry had terminated the Rs 3,546-crore VVIP chopper deal on the grounds that Anglo-Italian firm AgustaWestland had breached the integrity pact by allegedly paying kickbacks.

The formal cancellation of the deal was announced after Defence Minister A K Antony met Prime Minister Manmohan Singh and apprised him of developments in the case.

India had frozen the deal following a series of reports in The Indian Express that exposed claims that kickbacks worth 51 million euros were generated in the deal to supply 12 state-of-the-art helicopters to the IAF to fly VVIPs.




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Reference : indianexpress
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