India court rejects challenge to Dassault jet deal; win for Modi

NEW DELHI, (Reuters) - India’s top court rejected petitions yesterday seeking an investigation of fighter jet deal worth about $8.7 billion with France’s Dassault Aviation , handing a political victory to the ruling party months before a general election.

The ruling is a setback for the opposition Congress party, which had accused Prime Minister Narendra Modi’s government of corruption in the deal to buy 36 Rafale planes and a decision to pick Reliance Defence as a domestic partner.

Reliance, owned by billionaire Anil Ambani, has no aeronautical expertise and was chosen ahead of state-run Hindustan Aeronautics, which has a history of making planes.

Dassault said in October it picked Reliance as a partner on its own, countering a French online media report that said the Indian government insisted on the firm as a condition of the contract.

The petitioners, two former ministers of Modi’s Bharatiya Janata Party (BJP) and an activist lawyer, had argued that the escalating price of the deal should be investigated.

“We don’t find any material to show that it’s commercial favouritism,” Chief Justice Ranjan Gogoi said in delivering the court’s ruling. “It’s not proper for the court to examine each aspect of this case. It isn’t a job of the court to compare pricing details,” he said.

Congress used the issue to put pressure on Modi in recent state elections and ahead of a general election due by May. The BJP lost power in three heartland rural states in results announced this week.

The government and Reliance have said the charges are baseless.

Senior Congress leader Anand Sharma told reporters the party did not agree with the court ruling and demanded a parliamentary investigation into what he called an “arbitrary deal”.