"(The Ministry of Defence) today issued a formal show cause notice to AgustaWestland of UK seeking cancellation of contract and taking other action as per the terms of the contract and the integrity pact," ministry spokesman Sitanshu Kar said in a statement.
AgustaWestland, the wholly-owned subsidiary of Finmeccanica, has been given seven days to reply.
Meanwhile, the CBI today registered a complaint given by the Defence Ministry to probe alleged kickbacks paid by the Italian firm. The agency has registered the complaint to ascertain allegations of corruption against Indian nationals and whether any kickbacks were paid, CBI sources said.
The registration of complaint is the first step before initiating a formal inquiry in a case. A team of Defence Ministry officials today handed over to CBI documents pertaining to the case. Once a complaint is received from a Ministry, CBI officers decide whether it contains specific and definite allegations involving corruption or serious misconduct against public servants etc. which fall within the ambit of CBI.
After a complaint is registered, CBI decides whether to file Preliminary Enquiry, in case further ground work is required, and subsequently register a case or file an FIR directly. The CBI team had yesterday asked the officials to provide files related to any sort of internal enquiry undertaken by it in connection with alleged graft in acquiring 12 AW-101 helicopters from AgustaWestland for IAF's elite Communication Squadron, which ferries the president, prime minister and other VVIPs.
In February 2010, India had inked the Rs 3,600 crore deal to acquire 12 three-engine AW-101 helicopters. On Monday, Italian agencies had arrested Giuseppe Orsi, the CEO of Finmeccanica, for alleged bribes given to Indian middlemen to clinch the deal.