Day: April 27, 2017

Education

The big Story CASE FILES

Repeated warning signs were ignored by top army officers until 2011 when a probe was ordered

Whistleblower in MI-17 reports irregularities in equip­ment supplied by Rolta. The Rs 165-crore contract with the army is put on hold.

Ml finds grounds for a Col,
but Director General, Ml, Lt
General B.S.Thakur does not
order it. Three whistleblowers
posted out of the directorate.

  • co Army orders a Col after | o yet another Ml officer com- I >, plains in writing to then army 3 chief Bikram Singh. Army constitutes a Col into Rolta procurement and AMCs.
  • g Colonel Sujeet Banerjee found dead in room a day before he is to j r§ depose before Col.

Col issues arrest warrants for Lt General B.S.Thakur and Major General D.N. Asijafor not deposing.

ROLTA SAYS IT IS
NOT AN ACCUSED
IN THE ARMY Col,

IT DENIES CONTRAC-
TUALAND FINANCIAL
DISCREPANCIES
IN ANNUAL
MAINTENANCE
CONTRACTS.

Intergraph and Bentley—and sup­plied to the army by Rolta.

Over 70 such systems were pur­chased for the Indian Army and dis­tributed amongst specially created Imagery Interpretation feams (IITs) of the army among divisions, corps and commands to interpret satel­lite imagery and pass it on to tactical formations.

The firm, however, did not offer ‘software upgrades and updates’ as mentioned in the 1996 contract. From 2008, the annual maintenance contracts were reworded only to include the word ‘updates’. Colonel Banerjee suspected this was the case because the firm did not own the original software.

In 2009, the army had initiated the purchase of a fresh batch of GI systems to replace the older ones bought in 1998. It, however, insisted that the systems not be floated as a global tender and be purchased as a repeat order from Rolta. This meant that it would not have to follow the normal procedures of a fresh con­tract. The army insisted on single­vendor procurement despite the Defence Acquisition Council suggest­ing otherwise in 2010.

An MoD Cost Negotiation Committee noted that the company had now stamped its name on all the products. This was a marked change from a 2004 contract where Rolta was only the distributor for US-supplied software. Army officials say Colonel Banerjee made several futile attempts to alert Colonel M.K Chakraborty of the irregularities. In March 2011, Colonel Banerjee finally complained against Colonel Chakraborty to his seniors in the MI directorate. His superior officers Major General Asija, the then additional director general, MI (B) and Brigadier R. Chibber, addi­tional director general in-charge of technical equipment in the MI, rec­ommended a Col. The two officers had by then carried out extensive investigations with all the officers of MI-17 about the dubious software upgrades to establish that there were indeed grounds for a formal Col.

The whiff of a scandal would have immediately led to an inquiry,
particularly as it was flagged by two senior MI officers who put their com­plaint down in writing. However, the DGMI Lt General Thakur did not order a probe. What he did next only piqued the interest of the offi­cials handling the current inquiry. In August 2011, Lt General Thakur verbally asked the Military Secretary’s branch to post three officers out of the Directorate of MI—the whistle­blower Colonel Banerjee, Brigadier Chibber and a third officer in MI-17, Lt Colonel Sandeep Ahlawat, who had red-flagged the aberrations. All three officers were posted out of the directorate one month apart and sent to inconsequential appointments outside Delhi. Colonel Banerjee was posted to the Army Welfare Housing Organisation, a career dead-end. The matter seemed buried.

Rolta’s sale of a Rs 165-crore contract for purchasing sensitive spy imaging systems cleared in 2010 did not go through.

DEATH AND RESURRECTION In January 2013, another military intelligence officer detected anom­alies in the Rolta contracts. Major Shubda Naik, an intelligence corps officer posted in MI-17, wrote to then army chief General Bikram Singh about the discrepancies. On July 29, 2013, the army ordered a Col headed by Brigadier Ashwani Kumar. The key witness for the prosecution was going to be the original whistleblow­er, Colonel Banerjee. This was when matters took another curious turn. On January 26, 2014, just a day before he was to depose before the Board of Inquiry, Colonel Banerjee was found dead in his room in the United Services Institution (USI) in south Delhi.

A post-mortem revealed the cause of death to be heart attack. The inquiry was hobbled by his absence but continued as the court examined other officials who had pointed out irregularities. The Col is now over two years old. Unusual because army COIs don’t last more than six months. But then, few cases in the army have seen not one but three whistleblow­ers stand up and report irregularities. The delayed probe has stalled the

ROLTA

army’s attempt to replace its 1990s vintage imagery interpretation sys­tems that one officer terms “junk”. The blocked procurement pipeline is believed to now include a requirement for over 40 such systems, a glaring capability gap that has been repeat­edly flagged by army commanders in internal conferences.

One reason being given for the Col’s slow progress is the fact that Lt General Thakur, Major General Asija simply refused to join the probe. This left the court with no option but to issue arrest warrants against them. The warrants are with the district magistrates in Gurgaon and Noida where the two officers live after their retirement. The officers have so far refused to respond to the Col which was reconvened on June 23. Army officers say a fresh set of arrest warrants will now be served on them.

PAST IMPERFECT This is not Rolta’s first brush with controversy. In an April 2015 report, a California-based capital markets research firm, Glaucus Research Group, noted that “preponderance of evidence suggests that the vast majority of Rolta’s reported capital expendi­tures have been fabricated”. The report was an assessment of $500 million of junk bonds issued in the US market by Rolta’s Delaware subsidiary between 2013 and 2014 which had attracted inves- »- tors by offering tempting yields.

The group said that the IT firm’s reported spending in India was “dis­appearing into phantom prototypes, mysterious construction projects and computer systems of questionable authenticity and utility”.

It also flagged the fact that an ongoing Ministry of Defence inquiry had been omitted from its bond pro­spectuses, “which in our view is a material omission because the scan­dal could jeopardise future contracts with the Indian government. These incidents are further evidence of the lack of transparency or accountability at Rolta. ” Rolta has contested Glaucus’ findings, terming them “baseless”,

 

riddled with “factual errors” and “inaccuracies”. It referred to news reports cited by Glaucus of the defence ministry inquiry as making no express allegation or conclusion against the company or its officials. Accordingly, it is just an attempt to falsely imply the company’s complicity and impact its reputation, Rolta claimed.

The Col has photographs that show Colonel Chakraborty, director MI-17 and Colonel Banerjee’s boss, on a private holiday with Rolta execu­tives in 2009. Colonel Chakraborty did not return calls for comment.

Preliminary findings of the army Col seem to agree with what the MI

MI-17 DIRECTOR COLONEL M.K. CHAKRABORTY WITH ROLTA EXECUTIVES ON A HOLIDAY IN THAILAND, IN 2009

 

whistleblowers had said in their writ­ten complaints since 2011. The Col established contractual and financial discrepancies in the annual mainte­nance contracts concluded with Rolta after December 2008. Original con­tracts with Intergraph and Bentley and other third party software updates and upgrades were not pro­vided by Rolta despite the mandate for the supplier in the original contract. Rolta merged the costs of hardware and software in 2008, making it diffi­cult for the army to work out the loss to the exchequer due to the denial of software upgrades, officials familiar

 

with the Col say.

Company officials, however, strongly denied these findings. “Rolta has been providing comprehensive maintenance services to the Indian Army for two decades now and army users are completely satisfied with these services. There are no con­tractual and financial discrepancies in any annual maintenance contract with Rolta. In fact, army users have issued hundreds of letters appreciat­ing Rolta support services,” a compa­ny spokesperson said.

Rolta refutes it had withheld any deliverable that had been contracted for, a constant charge made by sever­al army whistleblowers. “Rolta provides comprehensive main­tenance services for integrated systems, as contracted,” the spokesperson told india today in a written response. “Rolta has met and exceeded all its contractual commitments, including supply of all software updates and upgrades. We categorically deny that Rolta has withheld or not provided any deliverable that has been contracted for.”

Responding to charges that it had pushed its software onto the Indian Army in the absence of competition from other soft­ware developers, the company spokesperson said that Rolta had followed due process in obtaining all required sanctions, its software had been tested by army users before induction by conducting an extensive pre­dispatch inspection and a joint receipt inspection, as per contractual provi­sions. “This software has been in sus­tained use at army formations for the last six-plus years and the company has received numerous appreciation letters from army user sites all over the country, which stand testimony to the quality of Rolta software and sup­port services.”

As the court of inquiry hurtles towards a long-awaited conclu­sion, the embattled whistleblowers in Military Intelligence hope to have proved them wrong.

Follow the writer on Twitter @SandeepUnnithan

By Amitabh Srivastava

A

frame with the photograph of a uniformed Pervez Musha­rraf, shaking hands with a smiling, kurta-clad Lalu Prasad is gathering cobwebs on the wall of a small room at 10, Circular Road in Patna. On the picture is the former Pakistani president’s hand­written compliments to the former chief minister of Bihar—“To an art­ist of a politician, Laloo Saheb.” The sprawling bungalow in the state capi­tal’s uber-plush locality is allotted to Lalu’s wife Rabri Devi. Between them, the couple administered— many say ruled—Bihar for 15 years, starting in 1990.

 

It’s 11 a.m. on a particularly humid late June morning, and the “artist” has retired for a siesta at his baithak (meeting room). Having attended to some visitors since 8.30 a.m., Lalu, his hangers-on say, would rest for a cou­ple of hours. There’s little sign of any­one here ruling any place outside the bungalow—at least for now. The doors of the baithak are open, and the air conditioner’s wheezing noise sounds almost like the state of affairs Lalu’s once-powerful party, the Rashtriya Janata Dal (RJD), is in today.

The contrast could not have been sharper in another bungalow a few kilometres away in Danapur, on the western outskirts of Patna. There are a dozen computers and half-a-dozen
people in six cubicles are frenetical­ly punching away on the keyboards on the first-floor office space in Lalu Prasad’s farmhouse. This is the work­ing office of Tej Pratap Yadav, 27, the elder of Lalu’s two sons, who seems to be emerging as the chosen one to take up the mantle from his battle- weary father. Inside his “war room”, Tej Pratap smiles after reading out the text that Anu Pandey, 22, has juxta­posed with a picture of Prime Minister Narendra Modi. It reads: “When will I get my Rs 15 lakh you had promised on poll eve?”

Hands on waist, the grin widens. “Good work. Now post it through all our Facebook accounts, and don’t for­get tagging as many users as you can,”

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