Defence Ministry suspends business links with Sanjay Bhandari's firm

The Defence Ministry on Friday ordered the suspension of all business link with a Delhi-based firm headed by fugitive arms dealer Sanjay Bhandari.

Bhandari's firm Offset India Solutions (P) Ltd is under investigation by Central Bureau of Investigation (CBI) and Delhi Police for its reported role as a defence contractor in the Rs 2,800 crore (6.09 million Swiss Franc) deal to purchase 75 Pilatus PC-7 basic trainer aircraft for the Indian Air Force.

The defence ministry order said that the investigating agencies were looking into the charges of "corrupt practices, unfair means and illegal activities" adopted by the company to swing the deal in favour of the Swiss company.

"Business dealings with Offset India Solutions (P) Ltd and its group companies will remain suspended for a period of six months," said the order.

Bhandari was booked after copies of classified reports were recovered from his residence by the Income-tax authorities during a raid in April 2016. A FIR against him was lodged in October, but Bhandari escaped to London.

There are reports in a section of the media claiming Bhandari's closeness to Robert Vadra, son-in-law of former Congress president Sonia Gandhi.

However, there is no official record of the association between the two and Congress never spoke about Bhandari's link with Vadra.

While Bhandari flew to London, CBI in November 2016 registered a preliminary enquiry report against Bhandari and his partner Bimal Sareen for their role in the basic trainer aircraft procurement case.

In May 2017, OIS was issued a show cause notice by the defence ministry on why business dealings in defence procurements with all its associate and group companies should not be suspended or banned.

The reply from the company was unsatisfactory, leading to the imposition of the ban.

The procurement of Pilatus PC 7 MkII was approved by the government in May 2012 and the first batch of PC-7 Mk II arrived at the Indian Air Force Academy in February 2013.