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Raj Kumar Makkad (Adv P & H High Court Chandigarh)     11 January 2011


Congress general secretary Digvijay Singh'Fs concern for Ottavio Quattrocchi, the Italian businessman who knocked off $7.3 million as commission from AB Bofors when we bought field guns from the Swedish company for our Army, is truly touching. Obviously he believes that the concept of Atithi Devo Bhava (guest is god) should extend to all guests, be they crooks, wheeler-dealers or commission agents.

According to Mr Digvijay Singh, the Income Tax Appellate Tribunal order naming Quattrocchi as a recipient of commissions is suspect on three counts. First, the timing of the order is "highly intriguing". The tribunal, he claims, advanced the date of the order from January 4 to December 31.

Second, the tribunal made the order public on January 3, a day before the Chief Metropolitan Magistrate was to take a view on the CBI's plea to close the criminal case against the Italian middleman. This 'haste' raises doubts about the ITAT's motive. Third, the tribunal was hearing the plea of Mr Hersh Chadha, son of Win Chadha, who was the agent for Bofors. Yet, it paid so much attention to the commission paid by Bofo closure examination. First of all, even if this were to be true, why is an Indian citizen like Mr Singh troubled by the fact that the ITAT advanced the date of the order regarding the tax liability of some commission agents, one of whom is a foreigner? Further, what is this 'haste' that he is talking about? Does he not know that the ITAT order has come a good 22 years after Bofors deposited the kickbacks in Quattrocchi's Swiss bank account?

Second, why is this citizen complaining that the order was made public on January 3? An alert citizen ought to ask why the order was not uploaded immediately after it was passed on December 31. Those who care for transparency and accountability in Indian institutions should be troubled on this score rather than crib about the fact that the order was publicised at a time that was very inconvenient to Quattrocchi.

Finally, we need to ask why this Congress worthy, who holds an important office in a party which was in the vanguard of India's freedom movement, is so stressed about the fact that the tribunal made a clinical analysis of the illegal payments made by Bofors to this Italian businessman.

That Mr Singh's concerns are grossly misplaced becomes obvious when one reads the order of the ITAT. The tribunal notes that despite a ban on agents, Bofors entered into a fresh consultancy agreement with AE Services Limited of the UK on November 15, 1985 "at the behest of one Mr Ottavio Quattrocchi, an Italian". According to this agreement, if Bofors was awarded the contract before March 31, 1986, it was to pay a fee equivalent to three per cent of the total value of the contract pro rata with the receipt of the payments.

By a strange coincidence, the Bofors-India contract was signed on March 24, 1986, just a week before the expiry of the deadline. Bofors deliberately suppressed the fact of this agreement in their letter of March 10, 1986 to the Ministry of Defence. The ITAT noted that Quattrocchi remained in India from February 28, 1965 to July 29, 1993, except for a brief interval from March 4, 1966 to June 12, 1968. He was a certified Chartered Accountant by profession, working with Snamprogetti, an Italian multi-national company. "Neither Snamprogetti nor Mr Quattrocchi had any experience of guns, gun-systems or any related defence equipments."

Based on bank documents obtained from Switzerland by Indian authorities, the tribunal concluded that after India paid Bofors SEK 1,682,132,196.80, equivalent to 20 per cent of the contract value, on May 2, 1986, Bofors remitted a sum of SEK 50,463,966.00 on September 3, 1986, to account number 18051-53 of AE Services Limited at Nordfinanz Bank in Zurich. This was exactly three per cent of the amount paid to Bofors in advance. Thereafter, Quattrocchi transferred funds from one account to another, all of which were operated by him and his wife Maria. The tribunal also noted that Quattrocchi gave a fake address in India ('Colony East, New Delhi, India') while opening one account.

In fact, the ITAT appears to have anticipated that some pro-Quattrocchi politicians like Mr Singh would raise questions about its order. Therefore, with a view to educate people like him the ITAT has said that "Indian income tax is leviable on all types of income, including legal and illegal income, whether recipients are Indian or foreign residents". It has, therefore, expressed surprise that though Win Chadha was proceeded against, "no action seems to have been taken" against Quattrocchi and other related entities.

"In our view, to enforce the rule of law, these steps were desirable to bring all the relevant income tax violations to a logical end by the Income Tax Department," the ITAT has said, adding. "Inaction in this regard may lead to a non-existent undesirable and detrimental notion that India is a soft state and one can meddle with its tax laws with impunity." Will any citizen who cares for India question such an order?

Fortunately, despite politicians like Mr Singh, who try to wreck the system from within, there are individuals and institutions in the country who help us keep the faith with the system. Among them are the two members of the ITAT who passed this order and Chief Metropolitan Magistrate Vinod Yadav who has rubbished the CBI's plea for closing the case against Quattrocchi and observed that there were mala fide intentions in defreezing the bank account of Quattrocchi. The judge has also questioned the CBI's decision to approach Interpol for removing the 'Red Corner' notice against Quattrocchi.

Obviously, the ultimate test of loyalty within the Congress is to genuflect before the Italian friends of the expatriate who is the party boss. To them, every Italian atithi is devo bhava! It is people like Mr Singh who had turned India into a slave nation for over a millennium.

Mr Singh has given us a glimpse of the depths to which sycophants will sink if Ms Sonia Gandhi were to become Prime Minister. This was exactly the concern of those who raised the foreigner issue a dozen years ago. The Congress general secretary has now proved that those concerns remain valid to this day.


 2 Replies

Avnish Kaur (Consultant)     11 January 2011


k.kumar raja (advocate)     02 March 2011

avnish is correct.

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