New Delhi: The government took the ‘ceremonial’ handover of the first Rafale jet for the Indian Air Force with much fanfare in September, but before the fighter planes can actually join the fleet starting next year, the deal for the 36 aircraft will once again have to pass the scrutiny of the Supreme Court on Thursday.
A three-judge bench led by Chief Justice Ranjan Gogoi will rule on the review petitions demanding that the court set aside its verdict of December 14 last year and order a criminal investigation into the controversial government-to-government deal with France.
The December verdict had declined a CBI investigation into the corruption allegations in the purchase of 36 jets from France’s Dassault Aviation at a cost of Rs 59,000 crore. The review pleas were filed by advocate Prashant Bhushan and former Union ministers Yashwant Sinha and Arun Shourie, among others, in December after a series of documents on the deal leaked from the defence ministry were published by The Hindu.
In a series of articles published starting February, the newspaper had reported that the defence ministry had in 2015 objected to “parallel negotiations” conducted by the Prime Minister’s Office with France. It had also quoted from a dissent note written by three senior defence ministry officials who were the domain experts on the seven-member Indian negotiating team.
In the review pleas, the petitioners alleged that the court’s ruling in December last year had “relied upon patently incorrect claims made by the government in an unsigned note given in a sealed cover”. The government had denied the allegations and rejected them as completely baseless.
The bench, also comprising justices SK Kaul and KM Joseph had on May 10, 2019, reserved its judgment in the case.
News18 explains the story so far in one of India’s most politically-infused and high-profile cases, a verdict on which could set a legal precedent and chart new political game plans.
What is the Rafale fighter jets deal?
The Rafale is a twin-engine multi-role combat jet designed and built by France’s Dassault Aviation. Although India had originally initiated the process and held negotiations to buy a fleet of 126 jets in 2007 under the-then UPA government, a final deal was only struck in 2015.
During PM Modi’s visit to France in April 2015, a government-to-government deal was signed for the purchase of 36 jets in flyaway condition. The decision has proven to be extremely controversial, with questions raised about whether India overpaid for the jets and if Modi broke protocol to benefit Anil Ambani’s Reliance group, which was then picked as Dassault’s main Indian partner.
The deal changed the terms of the original deal under the UPA wherein 18 jets were to be manufactured in France and 108 in India in collaboration with Hindustan Aeronautics Ltd (HAL) under transfer of technology.
Under the new deal, India was to start receiving the jets from September 2019 at the cost of Rs 1670 crore per fighter jet. To execute the offset obligation for the Rs 59,000 crore deal, Dassault Aviation set up a joint venture with Anil Ambani’s Reliance Defence Ltd (RDL). The transfer of technology clause was removed in the new deal.
What are the allegations in the case?
The Congress used the Rafale controversy as its main election plank against the BJP during the Lok Sabha polls held earlier this year. It accused the BJP government of engineering major irregularities in the deal, alleging that the government purchased each fighter jet at much higher cost, roughly three times, than the Rs 526 crore per jet finalised by the UPA government.
It also been demanded that the Centre give an answer to why state-run HAL was kept out of the deal, while private enterprise RDL was chosen as the offset partner. The joint venture between Dassault Aviation and RDL also came under scrutiny as the Congress sought an explanation over why a 12-day old company with no experience in manufacturing fighter jets replaced aerospace major HAL.
The government, however, has maintained its position on the defence deal and has rejected all allegations. In its defence, the ruling BJP has said that it removed the ToT clause and decided to buy the 36 aircraft in flyaway condition keeping in mind the “urgent” operational needs of the IAF.
It has also refused to share the price details of the jets citing a secrecy clause of a 2008 pact between India and France. The cost of 36 Rafale jets cannot be “directly compared” with the original proposal to buy 126 combat aircrafts as “deliverables” were different, the Centre has argued.
How did the Rafale deal case land in the SC?
Amid allegations of corruption, in September 2018, the Supreme Court agreed to hear a public interest writ petition by advocate ML Sharma, lawyer Vineet Dhanda, AAP MP Sanjay Singh and former BJP man Yashwant Sinha.
The petitioners raised concerns in the deal on whether PM Modi signed the deal without the approval of the Cabinet Committee of Security; did the Ministry of Defence approve RDL as Dassault Aviation’s Indian offset partner as per guidelines; why was HAL removed as an offset partner; and why the government is not disclosing details of the deal and violating a constitutional Act.
The judgment on this petition was reserved on November 14, 2018. However, one month later on December 14, 2019, the court dismissed all pleas seeking a probe into the alleged irregularities in the deal.
What was the Court’s rationale on dismissing pleas?
In its original ruling of December last year, the apex court said that it was satisfied with the government’s response and had found no evidence of irregularities having “studied the material carefully”. This came after the court had asked the Centre on October 10 to provide details of the decision making process in the French deal in a sealed cover.
On allegations of corruption, the apex court said it was satisfied with the pricing of the jets after having “examined closely the pricing details and comparison of the prices of the basic aircraft along with the escalation costs” from both the UPA and Modi-led negotiations. The court said that it did not consider necessary to repudiate the government’s claim that “there is a commercial advantage in the purchase of 36 Rafale aircrafts”.
The apex court also rejected allegations of commercial favouritism concerning the choice of RDL as the Indian offset partner for Dassault Aviation. The court said that the option to choose the Indian offset partner does not rest with the government. It remarked that “perception of individuals cannot be the basis of a fishing and roving enquiry by this court”.
Why was a review petition submitted in the Rafale case?
Following the December verdict, on February 21, 2019, a review petition challenging the judgment was filed by Yashwant Sinha, Arun Shourie and Prashant Bhushan, which the court agreed to hear.
The petitioners allege, on the basis of “secret documents,” that the judgment was based on incorrect factual claims made by the government. They said the government "wilfully and deliberately" misled the court and this amounted to "wholesale fraud".
In their arguments, the review petitioners referred to the secrecy clause of the inter-governmental agreement between India and France, to hold the government accountable for not furnishing full details of the deal.
During proceedings, the court on March 14, 2019, had also reserved its order on the review petitions with regards to the limited question of whether leaked documents could be placed on the record.
The review petitioners had placed reliance on documents leaked by the media to make their arguments for the suppression of information from court by the government. Citing internal reports of the defence ministry, the Hindu had reported that the ministry had objected to parallel negotiations by the Prime Minister’s Office.
However, a month later, on April 10, the court ruled that the classified documents could be placed on the record, thus dismissing the government’s objection.
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