France waived Rs 1,044 cr tax of Ambani firm after Rafale deal: Report

New Delhi: The Rafale jet deal was back in the eye of a political storm on Saturday as a French newspaper gave fresh anti-government ammunition to Opposition parties with its report hinting that Anil Ambani’s French firm got a tax waiver of Rs 1,044 crore within six months of Prime Minister Narendra Modi announcing a government to government deal for 36 Rafale fighter jets in Paris.

As Opposition parties renewed their attack on the BJP-led NDA government over the Rafale deal controversy, alleging that Prime Minister Narendra Modi was acting as a “middleman” for his “crony businessman”, Mr Ambani’s firm denied any wrongdoing and both the Indian and French governments claimed that there was no political interference or link between the firm’s tax waiver and the fighter jet deal.

Newspaper Le Monde reported that French tax authorities waived taxes worth 143.7 million euros (Rs 1,044 crore) to a French-registered telecom subsidiary of Mr Ambani’s Reliance Communications, Reliance Flag Atlantic France, in 2015.

The newspaper said the French tax authorities accepted 7.3 million euros (Rs 56 crore) from Reliance Flag, which owns telecom infrastructure in France, as a settlement against an original demand of 151 million euros (Rs 1,100 crore). Citing the report, the Congress alleged that the tax concession for Mr Ambani was due to Modi “kripa” (blessings), while the Left parties said the Prime Minister’s Office “must own up to this”.

Congress chief spokesperson Randeep Surjewala said, “This is called zero-sum choices, startling tax concession and Modi ‘kripa’.”

He said that the report exposed “layers” of crony capitalism and corruption.

“PM Modi is acting as middleman for Anil Ambani. How many other companies in France have got a tax benefit? Is this not a quid pro quo for the purchase of aircraft? It is clear only one watchman is the thief. Those who have Modi’s blessings can get anything. If Modiji is there, then it is possibile. (Modi ji ki kripa jispar ho jaye uska kuch bhi ho sakta hai, Modi hai to mumkin hai),” Mr Surjewala said, taunting the BJP on its poll slogan “Modi hai to mumkin hai”.

Mr Surjewala claimed that in 2017-18, Rafale maker, Dassault Aviation, deposited Rs 284 crore in the bank account of an inactive company Reliance Airport Developer’s Ltd. “This took place when the government of India was making advance payments to Dassault Aviation,” he said.

CPI(M) general secretary Sitaram Yechury alleged that the Modi government misused public funds to pay an “exorbitant” price for Rafale fighter jets to benefit “crony businessman” Anil Ambani through offset deal and French tax benefit.

“No wonder the BJP introduced secret electoral bonds for party funding, legalising corruption,” he said.

NCP chief Sharad Pawar claimed former defence minister Manohar Parrikar relinquished his post at the Centre and returned to Goa because he did not agree with the Rafale fighter jet deal.

CPI leader D. Raja accused the Modi government of aiding his “corporate friends” while leaving farmers and students high and dry.

However, the defence ministry termed as “mischievous” and “inaccurate” any attempt to draw a connection between the tax issue and the Rafale deal.

The French embassy here also issued a statement saying tax settlement with Reliance was not subject to any political interference whatsoever and was conducted in full adherence with legislative and regulatory framework.

In its reaction, Reliance Communications rejected any wrongdoing and said the tax dispute was settled under legal framework which is available for all companies operating in France.

The Congress has been alleging “favouritism” and “corruption” in the Rafale deal, saying the government was procuring each fighter jet at a cost of over Rs 1,670 crore as against Rs 526 crore finalised by the UPA government when it was negotiating.

The government and the BJP have maintained that there has been no wrongdoing in the deal.