French aircraft manufacturer Dassault Aviation SA, which makes the Rafale fighter jets, had paid one million euros (Rs 8.62 crore) to an Indian middleman, while finalising the Rafale deal with India, French anti-corruption authority Agence Francaise Anticorruption has found out.
An NDTV report quoting the AFA said, "As they (investigating agencies) combed through the 2017 accounts, the AFA inspectors raised an eyebrow when they came across an item of expenditure costing 508,925 euros and entered under the heading 'gifts to clients'."
The amount reportedly went to Sushen Gupta, who runs Defsys Solutions -- one of the subcontractors of Dassault in India.
Sushen Gupta is being investigated by the CBI and Enforcement Directorate in the AgustaWestland case involving kickbacks paid in India in a deal for VVIP choppers. Defsys is one of the subcontractors of Dassault in India. He was arrested but is currently out on bail.
"The company (Dassault) said the money was used to pay for the manufacture of 50 large replica models of Rafale jets, even though the inspectors were given no proof that these models were made," Mediapart reported.
The allegations were first uncovered by the French anti-corruption agency Agence Francaise Anticorruption (AFA) during their audit of Dassault, according to the report.
But the AFA "against all apparent logic" decided not to refer the case to prosecutors, it said.
"As they combed through the 2017 accounts, the AFA inspectors raised an eyebrow when they came across an item of expenditure costing 508,925 euros and entered under the heading 'gifts to clients'," the AFA report said.
"The sum was indeed huge for a gift. Though French law does not set out precise limits, legal precedents suggest that giving a watch or an expensive meal costing several hundred Euros can be enough to constitute corruption."
French journal Mediapart reported on April 4 that Dassault tried to get away with the "larger than usual gift" by producing an invoice dated March 30, 2017, from Defsys Solutions. As per the invoice, Defsys was paid 50 percent of the order worth 1,017,850 euros to manufacture 50 dummies of the Rafale jets.
The AFA inspectors asked Dassault for an explanation. "Why had Dassault ordered an Indian company to make models of its own aircraft at 20,000 Euros a plane? Why was this expenditure entered in the accounts as 'a gift to client'? And were these models, each one of which was supposed to be the size of a small car, really ever made?"
According to Mediapart, "Dassault was unable to provide the AFA with a single document showing that these models existed and were delivered, and not even a photograph. The inspectors this suspected that this was a bogus purchase designed to hide hidden financial transactions."
