India wins big in Italy, to get Rs 1,927 crore from Agusta

[li0nheart]

NEW DELHI: The defence ministry has scored a major legal victory against AgustaWestland in Italy and will be able to recover Rs 1,927 crore of the Rs 2,380 crore it had paid the Italian firm for supply of 12 VVIP helicopters.

After scrapping the deal, the ministry on January 1 decided to cash the three bank guarantees given by AgustaWestland through Deutsche Bank to recover its payments — around 45% of the total contract value of 556 million euros.

Within days of the decision to cash the bank guarantees, AgustaWestland approached two former chief justices of India — Justices G B Patnaik and S H Kapadia — asking whether India would be legally entitled to cash the guarantees since it had part performed the contract by supplying three of the 12 helicopters.

Armed with these opinions, AgustaWestland stalled MoD's decision to cash the bank guarantees by moving an Italian court, which on March 17 restrained India from recovering the money from the firm, the UK-based subsidiary of Italian conglomerate Finmeccanica.

MoD appealed against this in a higher court in Italy armed with an opinion of then additional solicitor general Gourab Banerjee, who extracted a series of Supreme Court judgments, given the fact that both the bank guarantees and performance bond expressly subjected themselves to Indian law, to counter the opinion of the two ex-CJIs.

Brushing aside AgustaWestland's defence, the appeal court struck down the March 17 order restraining India from cashing the bank guarantees except the logical correction - the cost of the three helicopters to be deducted from the money to be recovered by cashing the bank guarantees.

A three-judge bench headed by Laura Cosentini said in its order, "Considering that none of the guarantees was connected to a specific contractual obligation, that each was enforceable for any breach claimed by the ministry of defence, and that to support the enforcement evidence was brought of criminally relevant facts, we believe that the enforcement (cashing of bank guarantee) was fully legitimate, and was not affected by any abusive or fraudulent conduct."

Upholding MoD's decision to cash the bank guarantees, the bench asked AgustaWestland International Ltd and Agusta Westland SPA to reimburse the ministry 50% of its legal fees quantified at 20,000 euros plus ancillary due

India wins big in Italy, to get Rs 1,927 crore from Agusta - The Times of India

 

[janon]

Excellent, this should teach foreign companies not to corrupt our system. Win on your own merit, there is plenty of business to be done with India if you stick to that principle.

 

[Koovie]

What about the helos we already received?

Will we keep them?

 

[sancho]

What about the helos we already received?

Will we keep them?

That's the question, but I think it's doubtful that we will remain with them. It would be a burden to stick with them and add another type of VIP helicopters, let alone to remain with a good spare supply for them after this issue.

 

[Reviewer21]

Well this might be an alert for US to not to get into court cases against India unnecessarily(the IPR case). Anyways congrats Bharatvaasion

 

[Robinhood Pandey]

@MarkusS Italians lost the case

 

[MarkusS]

@MarkusS Italians lost the case

I hope india is fair enough and gives us the 3 helicopters back that we already delivered.

 

[Robinhood Pandey]

- the cost of the three helicopters to be deducted from the money to be recovered by cashing the bank guarantees.

I hope india is fair enough and gives us the 3 helicopters back that we already delivered.

 

[MarkusS]

Well and now? An italian court decided in indias favor. Would an indian court do the same if an indian corporation cheated on us?

 

[Indischer]

What about the helos we already received?

Will we keep them?

Not a wise decision if we do that. Those Helos will, after all, need spares and periodic maintenance sourced from Augusta Westland....and indigenizing spares for a fleet of just 3 will in all likelihood be very expensive.

We ought to return them and demand that all the cash we paid upfront be returned.

 

[Robinhood Pandey]

Well and now? An italian court decided in indias favor. Would an indian court do the same if an indian corporation cheated on us?

Stop crying now.

if you have anything to prove legally against any Indian firm . .lodge your case in a court and win it.

Don't look for favours.

 

[MarkusS]

Stop crying now.

if you have anything to prove legally against any Indian firm . .lodge your case in a court and win it.

Don't look for favours.

I'm not crying. Agusta made a mistake and the deal is cancelled. I accept this. The bank will pay the guarantee to damage for Agusta is small and no big problem. One manager made a bad decission and we pay the price. No need to kick on italy, dont you think?

 

[sancho]

I hope india is fair enough and gives us the 3 helicopters back that we already delivered.

Giving them back won't be the issue if we get our money back too, the qustion is if AW wants them back, because they won't be able to sell them just like that, for the same costs that India paid for them.

 

[Reviewer21]

@MarkusS Italians lost the case

AKA Sonia madamji and his pappu...

 

[MarkusS]

Giving them back won't be the issue if we get our money back too, the qustion is if AW wants them back, because they won't be able to sell them just like that, for the same costs that India paid for them.

Well better sell them for a lower price than no profit at all, dont you think?