India’s defence ministry has issued a final “show cause” notice to AgustaWestland seeking to cancel a deal to buy a dozen helicopters and gave the Italian company 21 days to reply, a government official said on Wednesday.
The official said the company, a subsidiary of Finmeccanica, has been asked to explain why action should not be taken against for violating the terms of the pre-contract integrity pact.
In February, India froze payments on the 560 million euro ($762.91 million) contract to the helicopters after the deal became mired in allegations of bribery and the then-CEO of Finmeccanica was arrested by Italian police for allegedly paying bribes to secure the deal.
AgustaWestland denies the allegations.
Reporting by Nigam Prusty; Writing by Sanjeev Miglani