NEW DELHI: The Central Bureau of Investigation has registered a preliminary enquiry (PE) on Saturday to investigate allegations of Brazilian aviation major Embraer hiring a UK-based agent and paying commissions to swing the $208 million deal for three Emb-145 aircraft inked with India during UPA rule in 2008.
It is alleged commission was being paid to middleman in the supply of three aircraft worth $ 208 million from Brazilian company Embraer to Defence Research and Development Organisation for airborne surveillance systems.
The agency said that they have started a preliminary enquiry against unknown officials of Defence Ministry on a reference from the ministry that the company used services of middleman.
A preliminary enquiry is registered by the agency when the complaint is short on enough material to substantiate a prima facie criminality in its allegations.
After registering the PE, CBI examines various stakeholders, seeks material related to the matter to zero in on the criminality and then registers an FIR against the suspects. During a preliminary enquiry, the agency cannot record statements or carry out searches.
The agency on Thursday got all the relevant documents related to the deal from Ministry of Defence, which includes, tendering process, proposals and other materials related to the deal. According to defence procurement rules of India, middlemen are strictly barred in such deals.
Government had stated that the allegations were of a serious nature and the CBI will probe.
Defence Minister Manohar Parrikar had earlier this week said that, "If there is a criminal angle, then the CBI will probe as the Ministry cannot". "If only procedural issues are involved, then the Defence Ministry can do an internal investigation," he had said.
The deal for purchase of three Embraer aircraft during the UPA regime has kicked up dust with US authorities going into alleged payment of kickbacks. The deal has come under the scanner of the US Justice Department which has been probing Embraer for alleged payment of bribes to secure contracts.
Soon after, the reports of irregularity surfaced, the DRDO has already sought a report from the Brazilian firm, which has said it has been looking into graft allegations over the last five years.
The Special Investigation Team probing AgustaWestland bribery scandal will also probe this scam.
The deal was signed in 2008 between Embraer and the DRDO for three aircraft equipped with indigenous radars for AEW&C (airborne early warning and control systems). The first "modified" aircraft was delivered to DRDO in 2011, with the other two following later. After several missed deadlines, the AEW&C project is now slated to be completed by December. Present DRDO chief S Christopher was the AEW&C programme director and head of the Centre for Airborne Systems (CABS) before he was chosen to head DRDO in May 2015 by the NDA government.
Sources claimed that role of the committee, comprised of officials from IAF and DRDO is also under scanner, which shortlisted the Embraer deal.
Brazil's top newspaper, the 'Folha de Sao Paulo', had reported on September 8 that the possible bribery in the 2008 Indian deal was under the scanner of the US justice department, which has been investigating Embraer since 2010, after a contract with the Dominican Republic raised suspicion. The scope of the investigation has now been widened to examine Embraer's dealings with eight other countries, including India and Saudi Arabia.