Five arrested in defence scam

CBI today arrested V K Pande, General Manager of the Defence Ordinance factory at Medak in Andhra Pradesh and four others in connection with alleged corruption in supply of army battle tanks.

CBI sources said Pande, T Muralidhar Bhagavat, Managing Director of AMW MGM Forgings Pvt ltd, Mysore and K R Mugilan, DGM, marketing AMW MGM Forgings, had been brought to Kochi for interrogation on Monday and were arrested tonight.

The two others arrested were Shahnaaz and Valsan, Managing Director and Marketing Manager respectively of state-owned Steel and Industrial Forgings Ltd (SIFL), CBI sources said.

The case relates to Thrissur-based SIFL having sold spare parts to DOD and the Heavy Vehicles factory at Avadi in Chennai allegedly by bribing officials.

CBI, Kochi unit, probed the case and unearthed the fraud in the supply of components for Arjun tank.

All the accused will be produced before a CBI court tomorrow.

Subi Malli, a Mumbai-based bussinesswoman, who was the mediator in the deal, had been arrested by CBI earlier and is now on bail. She has been asked to appear before the CBI court tomorrow.

The allegation against the accused is that some officials of SIFL, which is a regular supplier of roadwheel arm and flange used in the manufacture of artillary tank, conspired with Malli to influence the public servants of defence establishment at Avadi and bagged some contracts at highly inflated rates, thus causing loss to the state exchequer.

The case was registered by CBI after conducting searches at the residences and premises of suspects in Kerala, Mumbai, Avadi and Hyderabad.