Bofors Scandal - Chronology of Events and Investigation

Chronology of Events and Investigation

On March 24, 1986, a $285 million (about 1,500 crore) contract between the Govt of India and Swedish arms company Bofors was signed for supply of 410 155mm Howitzer field guns. About an year later, on April 16, 1987, Swedish Radio alleged that Bofors paid kickbacks to top Indian politicians and key defence officials to seal the deal.

The middleman associated with the scandal was Ottavio Quattrocchi, an Italian businessman who represented the petrochemicals firm Snamprogetti. Quattrocchi was reportedly close to the family of Gandhi and emerged as a powerful broker in the 1980s between big businesses and the Indian government. While the case was being investigated, Rajiv Gandhi was assassinated on May 21, 1991 for an unrelated cause by the LTTE. In 1997, the Swiss banks released some 500 documents after years of legal battle. On October 22, 1999 (when National Democratic Alliance government led by the Bharatiya Janata Party was in power) the Central Bureau of Investigation (CBI) filed the first chargesheet against Quattrocchi, Win Chadha, Rajiv Gandhi, the defence secretary S. K. Bhatnagar and a number of others. In second half of 2001, Win Chadha and S. K. Bhatnagar died.

On June 10, 2002, Delhi High Court quashed all proceedings in the case so far. However, this was reversed by Supreme Court of India on July 7, 2003.

Meanwhile the central government changed and Indian National Congress came to power after 2004 Lok Sabha elections. On February 5, 2004, the Delhi High Court quashed the charges of bribery against Rajiv Gandhi and others, On May 31, 2005, the Delhi High Court dismissed the allegations against the British business brothers, Shrichand, Gopichand and Prakash Hinduja, but charges against others remain. In December 2005, Mr B. Daat, the Additional Solicitor General of India, acting on behalf of the Indian Government and the CBI, requested the British Government that two British bank accounts of Ottavio Quattrocchi be unfrozen on the grounds of insufficient evidence to link these accounts to the Bofors payoff. The two accounts, containing €3 million and $1 million, had been frozen. On January 16, the Indian Supreme Court directed the Indian government to ensure that Ottavio Quattrocchi did not withdraw money from the two bank accounts in London. The CBI, the Indian federal law enforcement agency, on January 23, 2006 admitted that roughly Rs 21 crore, about US $4.6 million, in the two accounts have already been withdrawn by the accused. The British government released the funds later.

However, on January 16, 2006, CBI claimed in an affidavit filed before the Supreme Court that they were still pursuing extradition orders for Quattrocchi. The Interpol, at the request of the CBI, has a long-standing red corner notice to arrest Quattrocchi. Quattrocchi was detained in Argentina on 6 February 2007, but the news of his detention was released by the CBI only on 23 February. Quattrocchi was released by Argentinian police. However, his passport was impounded and he was not allowed to leave the country.

As there was no extradition treaty between India and Argentina, the case was presented in the Argentine Supreme Court. The government of India lost the extradition case as the government of India did not provide a key court order which was the basis of Quattrochi's arrest. In the aftermath, the government did not appeal this decision because of delays in securing an official English translation of the court's decision.

A Delhi court provided temporary relief for Quattrocchi from the case, for lack of sufficient evidence against him, on 4 March 2011. However the case is still going on.

Despite the controversy the Bofors gun was used extensively as the primary field artillery during the Kargil War with Pakistan and gave India 'an edge' against Pakistan according to battlefield commanders.