No sovereign guarantee on Rafale deal, admits Centre

No sovereign guarantee on Rafale deal, admits Centre

Senior lawyer Prashant Bhushan with former union minister Arun Shourie at the Supreme Court during a hearing on Rafale deal, in New Delhi, Wednesday. PTI photo

The Centre on Wednesday admitted before the Supreme Court that the inter-governmental agreement signed with France in April 2016 did not carry a sovereign guarantee if Dassault Aviation defaulted in supplying Rafale fighter aircraft.

Instead, “there is a letter of comfort from the French government,” Attorney General K K Venugopal told the top court which reserved its judgement on a plea by former Union ministers Yashwant Sinha, Arun Shourie and others seeking a court-monitored probe into the Union government’s 2016 deal to buy the fighter jets.

A bench of Chief Justice Ranjan Gogoi and justices Sanjay Kishan Kaul and K M Joseph wrapped up the four-hour hearing in the matter by giving the opportunity of advancing arguments to Shourie, advocates Prashant Bhushan, M L Sharma and counsel for advocate Vineet Dhanda and AAP MP Sanjay Singh.



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Four top officers, including Vice Chief of Air Staff Air Marshall Anil Khosla, Air Marshall V R Chaudhari and J Chelapati, who appeared before the court, submitted that there has been no fresh induction after Mirage aircraft in 1985.

The bench brushed aside questions of pricing of the 36 aircraft sought to be procured, even as the petitioners claimed it was worth Rs 60,000 crore. “Any debate on pricing can come only if the court decides these aspects need to be put in public domain,” the CJI said.

Venugopal defended the agreement, while maintaining that the issue involved was of national security and could not be a matter of judicial scrutiny or determination. He said the choice of equipment and weaponry must be left to experts. He, however, admitted that there was no sovereign guarantee in the inter-governmental agreement, but there was a “letter of comfort” if there was any breach.

Venugopal said that had Rafale been acquired earlier, it would have saved casualties during the Kargil war, having the capability of hitting target from a 60-kilometre distance.

Venugopal said the price of Rafale aircraft was not disclosed to Parliament and the RTI would not apply in view of the secrecy clause in the agreement. “But now, we have given the entire break-up on price, weaponry and its advantages to the court,” he said.

Bhushan submitted apart from price, procedure and offset partner, question also arose if inter-government agreement was at all required. “This has obviated the need for inviting bids though there was no sovereign guarantee from France,” he said.

He said a ham-handed attempt was made in May 2015 in a mala fide manner to amend offset agreement after joint statement by Prime Minister Narendra Modi and French President Francois Hollande was made on the deal.

“A done-deal was scrapped to strike a fresh one to help Anil Ambani's Reliance Defence Ltd, a company, incorporated just days before,” he said, adding that the registration of an FIR was a must to probe criminality and its possibilities.

Shourie, in his submission, referred to the then defence minister Manohar Parikkar's statement wherein he said it was Prime Minister Modi's decision to reduce the number of aircraft and to strike a fresh deal. There was no deference to any procedure, he said.