CAG report in Rafale
The CAG gave a preliminary response in the selection of Rafale but never finalized medium multi-role combat aircraft project of 126 fighters under UPA, which raised the question how NDA government made Rs 59,000 crore direct acquisition of 36 of the French fighters.
The government contends in the acquisition of at least 36 Rafale fighter was “a critical operational necessity” for the IAF. Moreover, according to Central Vigilance Commission guidelines, negotiations could not be held with the competitors who came second in the bid, the Eurofighter Typhoon.
The deadlocked MMRCA project, under which the first 118 fighters were to come in a “flyaway condition" with the rest being licensed produced by defence PSU Hindustan Aeronautics Ltd, was formally scrapped by the NDA government in June 2015.
But the CAG criticized the selection of Rafale on several counts. One, Dassault was provided with the opportunity to "significantly, modify its technical and price bids in clear violation" of the defence procurement procedure. Two, Dassault's bid was non-compliant on warranty and option clauses, while rafale also failed to meet 14 ASGRs during the field trials. Three, Dassault did not submit its price bid in the prescribed format. Four, parity was not maintained on the direct cost of acquisition by the Contract Begotioants Committer.
Dassault during the final negotiations said it would only stand performance guarantee for the first 18 flyaway jets. HAL, in turn, would be responsible for the quality of the 108 jets to be manufactured by it after transfer of technology.