New Delhi: Failing to serve court summons to overseas accused, the Enforcement Directorate (ED) has filed a plea to segregate trial proceedings in the money laundering case linked to the Embraer jets deal case.
The agency wants the trial to proceed with those accused who have already been served the summons, while proceedings for those who are yet to be served the summons can be held later.
In February, a special court had allowed a similar application by the ED in the AgustaWestland VVIP chopper deal case. Proceedings had moved forward even though summons had not been served to 21 of the accused.
The latest plea, moved Thursday before a special court in Delhi, has been taken up by the court. The agency has maintained that it is doing its best to serve the summons to three accused—Embraer Representation LLC (subsidiary of Brazil-based Embraer), Dubai-based firm Rawasi Al Khaleej General Trading FZE, and its director, Anurag Potdar.
The development comes as the agency awaits a response from the Ministry of Home Affairs on the execution of summons, particularly in Brazil. The agency is also facing the court’s repeated criticism for delay in trials due to overseas summons not being served. Potdar’s extradition is pending, the agency has informed, while the Dubai-based firm was not found at the registered address, leading to failure in serving summons.
The agency’s case stems from a probe of the Central Bureau of Investigation, which had, in October 2016, booked unknown officials of the Ministry of Defence, the Brazilian aviation firm Embraer, London-based middleman Vipin Khanna and Singapore-based Interdev Pvt Ltd, on allegations of corruption and payment of kickbacks to government officials for the acquisition of three Embraer jets.
The CBI’s case followed the United States Department of Justice’s prosecution agreement, which disclosed Embraer’s bribes to officials of four governments, including India, in connection with the sale of its highly specialised military aircraft.
The US prosecution agreement revealed that Embraer signed an agreement with Khanna’s firm to pay a commission of 9 percent of the total value of defence contracts received from the Indian Air Force (IAF).
It was documented in the prosecution agreement that less than a month after the firm signed a deal with a UK-based firm, the company signed an MoU with the Defence Research and Development Organisation (DRDO) to help in the development of a new early warning radar system for the IAF. Three years after the original agreement, Embraer got the contract to supply three EMB 145 AEW ‘Netra’ aircraft at a cost of approximately $208 mn.
“ED has filed an application u/s 317(2) Cr. PC (Section 355 of BNSS, 2023), vide which it has prayed that trial with respect to accused No. 2 (M/s Embraer Representations LLC), accused No. 6 (M/s Rawasi Al Khaleej General Trading FZE) and accused No. 8 (Sh. Anurag Potdar), be separated in view of processes for summoning, which are yet to be executed,” Special CBI Judge Prashant Sharma observed in the order passed Saturday.
ED’s case and trial proceedings stalled
Based on CBI’s FIR, the ED had in 2016 opened an Enforcement Case Information Report, and filed a prosecution complaint against 11 accused, including Brazilian firm Embraer, its defunct subsidiary Embraer Representations LLC, along with Switzerland-based subsidiary ECC Investment Switzerland AG in December 2020.
The agency has alleged in the charge sheet that the bribe amounting to USD 5.76 million was paid to Singapore-based Interdev Aviation Services Pvt Ltd against three invoices raised by the firm by Embraer SA through ECC Investment Switzerland AG between January and February 2010.
Subsequently, Interdev Aviation Services credited a sum of USD 3.2 million to the accounts of KRBL DMCC (A-6), a wholly-owned subsidiary of an Indian firm, KRBL Ltd. Group, before the exact amount was further transferred to a Dubai-based firm of the group, namely Rawasai AL Khaleelj General Trading FZE. It was through this firm that kickbacks were further routed to Khanna and Gautam Khaitan, the agency alleged. Khanna died in 2019.
The court took cognisance of the ED’s prosecution complaint and issued summons to all accused charged by the agency, including Embraer and its subsidiaries.
However, the process has not moved forward since then, and a Joint Director-level officer submitted before the court on Saturday that all efforts are underway to serve the summons to the three remaining accused.
Over the course of hearings, the court has flagged “inordinate delay” and proceedings coming to a halt, and in July this year, asked the ED to decide whether to send an officer to Brazil to serve the summons or drop the proceedings against the accused.
The court, however, has also acknowledged the difficulty in executing the process, given that the accused entities are located outside the country.
ED’s counsel informed the court last month that the department has been pursuing the matter with the concerned authority and that the MHA had already written a letter to the Indian embassy in Brazil to expedite the process and submit the status, which would have been submitted to the court.
(Edited by Viny Mishra)
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