The defence ministry of India has suspended all business dealings with Swiss aircraft manufacturer Pilatus for violating the “pre-contract integrity pact” (PCIP).
The government alleged that the Swiss company hired absconding arms dealer Sanjay Bhandari to swing the Rs 2,896 crore in commission in a deal for 75 of its basic trainer aircraft in May 2012.
The MoD order, says the 75 propeller-driven Pilatus PC-7 trainer aircraft currently being used by IAF to train rookie pilots had a kickback in purchase.
Swiss aircraft manufacture admitted paying 1 million Swiss Francs into the account set up by Bhandari’s flagship Offset India Solutions Private Ltd (OIS) to consolidate the deal.
Bhandari, who is believed to have escaped to London, is facing charges for violating the stringent Official Secrets Act (OSA) as well as financial crimes ranging from money laundering to corruption in arms deals.