“A Show Cause Notice has been sent to AgustaWestland, asking them to explain as to why steps should not be initiated for contract cancellation. The contract has been put on hold and further payments have been stopped. No decision to blacklist the company has so far been taken,” he said.
The defence minister said further details of the investigations would be known only after the receipt of the CBI report into the matter.
The minister also said his ministry took prompt action to seek factual information from the concerned authorities soon after reports about alleged wrongdoings came up.
Meanwhile, answering to another query, the minister said the procurement proposal for 197 light utility helicopters was under progress and “is due for consideration of the Defence Acquisition Council (DAC).”
Antony said reduction of Rs. 14,000 crore in the defence budget for the current fiscal would not affect operational capabilities of the armed forces.
“We will not compromise on operational capabilities of the armed forces”.
The allocation to the defence ministry for the current financial year has been reduced by Rs. 4,903.77 crore under the revenue segment and Rs. 10,000 crore under capital in the revised estimates of 2012-13.