The prosecutors in Italy have focused on India as part of a larger inquiry against Finmeccanica, the parent company of AgustaWestland (AW). They say that India signed up for 12 VVIP helicopters after retired Air Chief Marshall SP Tyagi twisted the rules of the tender in favour of AgustaWestland in return for kickbacks that were deposited with his cousins.
The entire deal was worth about 4,000 crores. The Italian enquiry says kickbacks added upto 360 crores. SP Tyagi headed the air force from 2004-2007, when the crucial changes to the tender were made. (Read: Who were bribes paid to, India asks manufacturer)
Former Air Force chief SP Tyagi has denied the allegations against him and has said that he met one of the alleged AgustaWestland middlemen just once. But the Italian report says middleman Ralph Haschke has "confessed" that he met six or seven times with the air force chief who supplied updates on the progress in the tender. "Haschke once greeted Air Chief Marshal Tyagi by touching his feet as a sign of respect," the Italian prosecutors claim. (Read: Met ex-air force chief a few times: middleman)
The report says that 100,000 Euros in cash was delivered by Haschke to the Tyagi brothers in their office, but stresses that "No money was transferred in the presence of Air Marshal Tyagi." (Read: Ex-Air Force chief's cousin denies any kickbacks)
The scam is pivoted on the assumption that the requirements for the 12 helicopters were changed to benefit AgustaWestland. In 2003, when the BJP-led NDA was in power, the flying altitude for the choppers was reduced from 18,000 to 15,000 feet. Another major change allegedly engineered by Tyagi was an engine failure flying test. This favoured AgustaWestland as its helicopters were the only ones in the tender operating with three engines.
These new changes were formalized in 2006, after the BJP had been replaced by the Congress-led UPA government. At this time, Pranab Mukherjee was Defence Minister.