New Delhi, January 7

In an offshoot of the Bofors guns purchase case, two executives of a private company have been convicted by a Special CBI court, Mumbai, in a 25-year-old matter pertaining to criminal conspiracy and cheating in exports to the Swedish company.Additional Chief Metropolitan Magistrate Laxmi Kant Bidwai has convicted Abhay V Udeshi, director of Jayant Oil Mills, and Harish Pandya, an employee of the company, for criminal conspiracy and cheating and sentenced them to two years of imprisonment.In a recent order, Bidwai said it was a case of cheating to cause “damage or harm” to the reputation of the Indian government in the international market. “This is not only an attempt to commit cheating but it is a complete act of cheating,” he said.India had inked a deal with Swedish company Bofors for the supply of 400 155-mm Howitzer guns for the Army worth Rs 1,437 crore in 1986 through a counter trade agreement.One of the conditions of the agreement was that in return of the sale of guns, Bofors would import from India commodities such as coffee and castor oil and its byproducts. The Indian government had nominated the State Trading Corporation (STC) as the nodal agency to monitor the import of castor oil and other commodities by Bofors from India.Similarly, Bofors had nominated London-based Alexander Crichton Associates Limited to import various commodities from India on its behalf under counter trade obligation. Jayant Oil Mills agreed to export castor oil and its byproducts to Bofors through the London-based company. As part of the trade, Jayant Oil Mills had to pay 0.5 per cent of the Free On Board value of the export to the STC as a service charge.In 1989-90, Abhay V Udeshi and Vithaldas G Udeshi — both directors of Jayant Mills — along with Harish K Pandya, an employee of the company, entered into a criminal conspiracy to cheat the STC.  The trio submitted the forged documents to Alexander Crichton Associates Ltd which forwarded those papers to STC, without the actual export of a goods consignment.The STC officials noticed the fraud and informed the CBI which started the investigation in 1992. — PTI25-year-old export fraud

• As part of the 1986 deal for purchase of 400 155-mm Howitzer guns for the Army, Bofors was to import from India commodities such as coffee and castor oil and byproducts
• In 1989-90, on behalf of directors of Jayant Mills Abhay V Udeshi and Vithaldas G Udeshi, employee Harish K Pandya prepared false export shipment papers and sought payment
• The CBI started the probe in 1992 and framed charges against Abhay, Vithaldas and Pandya in 2004. Vithaldas died during the trial and proceedings against him were dropped