CBI books Rolls-Royce over alleged bribes to unknown officials of HAL, GAIL India and ONGC

In a major crackdown on corruption, the Central Bureau of Investigation (CBI) has booked the UK-based Rolls-Royce and some unknown officials of Hindustan Aeronautics Limited (HAL), government-owned Oil and Natural Gas Corporation (ONGC) and Gas Authority of India Ltd. (GAIL India) over corruption allegations, as per sources.

Sources report that during the 2000-2013 period, Rolls-Royce reportedly got contacts from HAL worth Rs.4700 crores and several contracts from ONGC and GAIL India. The CBI has alleged that Rolls-Royce has paid around Rs.75 crores as a bribe to unknown officials of HAL, ONGC and GAIL India through the Delhi-based company M/s Aashmore Pvt Ltd.

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CBI probes into Rolls-Royce case

Earlier in May, the Union Petroleum Ministry had directed GAIL India and ONGC to seek a CBI inquiry into their purchase of gas turbines from Rolls-Royce after the UK-based company had disclosed that it paid commissions to Indian agents, as per news reports.

Reports say that this move had occurred after the Defence Ministry had a put on hold all deals with Rolls-Royce - which is also a major multinational defence and aerospace company until the CBI investigation into allegations of bribes being paid for the supply of aircraft engines to HAL was completed.

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What is the Rolls-Royce corruption case?

On December 23, 2013, news reports state that Rolls-Royce had admitted to GAIL that it had paid commission to its agents after its internal compliance review indicated that the M/s Aashmore Pvt Ltd was paid 10% to 11.3% commission. As per reports, these transactions were not done with the knowledge of GAIL India.

After this admission, GAIL had issued a show-cause notice to Rolls Royce in March 2014 stating that such undisclosed commissions were not in line with clause 19 of Instructions to Bidders of the Order, threatening to put Rolls-Royce Energy System Inc of the US and Rolls-Royce Singapore Pte Ltd on the banned list, as per reports. 

Similarly, state-owned ONGC too issued a show-cause notice to Rolls-Royce to refund the commission while suggesting a  CBI probe into the issue to reveal "beneficiaries and intended purposes of commissions."