Govt wants CBI to probe Rolls Royce deals with ONGC, GAIL

May 02 2014, 09:35 IST
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SummaryRolls-Royce has disclosed that it paid commissions to Indian agents for supplying gas turbines to ONGC, Gail.

3, 2014, GAIL issued a show cause notice, and said it was “not correct” that Rolls-Royce had declared commission to Infinity in the VDBPL project. The undisclosed commission was $ 2.5 million for an October 2008 order, and $ 1.84 million for an August 2009 order.

“With regards to the observation ‘As is known to you’ regarding service from Infinity Projects against the VDBPL contract, we do not agree to your submission since it was never known to GAIL nor it was ever been informed by Rolls-Royce to GAIL earlier,” it wrote.

It said that such “wrong declaration” of commission was not in line with clause 19 of Instructions to Bidders of the Order and threatened to put Rolls-Royce Energy System Inc of the US and Rolls-Royce Singapore Pte Ltd on the banned list, thereby debarring them from doing any future business with GAIL.

In the case of ONGC, Rolls-Royce wrote on December 19, 2013, that commission was paid to Patni in connection with several ONGC tenders/contracts in the past, a violation of the Integrity Pact. ONGC issued a show cause on March 13, 2014, asking Rolls-Royce to refund the commission paid.

ONGC also suggested to the ministry that “beneficiaries and intended purposes of commissions could be revealed through an in-depth investigation by an agency such as CBI”.

A similar recommendation was made for contracts awarded through HAL, which awarded 38 contracts for overhauling of generators and service contracts from 2007 on behalf of ONGC.

Rolls-Royce has over the years supplied 63 out of the 72 gas turbines installed on GAIL’s nationwide pipeline network. The British company also provides spares and services to the turbines.

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