India today cancelled its 3,600 crore rupees deal with Anglo-Italian firm AugustaWestland International Ltd (AWIL) for supply of 12 VVIP choppers to the Air Force with immediate effect. According to the official release, the deal was scrapped on grounds of breach of the Pre-contract Integrity Pact and the Agreement by AWIL. The move came in the wake of the charges that the kickbacks to the tune of 360 crore rupees were paid in the deal.

Based on the opinion received earlier from the Attorney General of India, it has been the view of the Government that integrity-related issues are not subject to arbitration. However, Anglo-Italian firm has since pressed for arbitration and appointed an arbitrator from its side. In view of this, the Defence Ministry sought a fresh opinion of the Attorney General. The Ministry has nominated Justice BP Jeevan Reddy as its arbitrator to safeguard the interests of the Government.