'Several instances' of deviation in VVIP chopper deal: CAG
Posted on: 13 Aug 2013
New Delhi:The CAG today slammed the DefenceMinistry and Air Force for 'several instances' of deviation from rules in the procurement of VVIP choppers in the Rs 3,727 crore AgustaWestland deal. In its report tabled in Parliament, the Comptroller and Auditor General also questioned the decision of the then IAF chief to hold the trials of the two contenders for the deal
abroad. The CAG also noted that the benchmark cost of Rs 4,871.5 crore for the 12 VVIP choppers was 'unreasonably high' as compared to the Rs 3,966 crore quoted by AgustaWestland. 'Several instances have been observed where the Defence Ministry deviated from the 2006 Defence Procurement Procedure and the tender for the deal issued in Sept. 2006,' the report stated. As per the DPP, a reasonable price is benchmarked by the Contract Negotiation Committee (CNC) while proceeding with a deal. But the benchmark price of Rs 4,871 crore arrived at by
CNC was 'unreasonably high as it had provided no realistic
basis for comparison with the offered cost of Rs 3,966 crore
(by AgustaWestland) for price negotiations,' the report said.
The report added that while an approval for deviation was
required to be pursued with 'extreme caution and in
exceptional circumstances', the frequent deviations made in
this case are counter to the clauses of the DPP 2006.
The CAG also criticised the procurement of four additional
choppers in the deal at a cost of Rs 1,240 crore as
'avoidable' and said that the assessed requirement was not
commensurate with the low utilisation levels of existing
helicopters providing transportation to VVIPs.