Bofors scandal resurfaces to tarnish Congress party

One of India's biggest corruption scandals from the 1980s has resurfaced to tarnish the ruling Congress party and embolden an opposition that has paralysed parliament with protests over graft accusations.

A senior leader of the opposition Bharatiya Janata Party (BJP) said the claims of kickbacks paid during a USD 1.4 billion defence deal would be brought to parliament, as a court decides whether to allow investigators to end their inquiry into the allegations.

Congress is already under pressure from the BJP's demands for a joint parliamentary inquiry into a USD 39 billion telecoms scam involving Congress-backed former Minister A. Raja, which shut down parliament for its December session.

The controversy over a 1986 defence deal caused former Congress leader Rajiv Gandhi to lose a 1989 election, and while his name was cleared in 2004, it could now plague his widow and current party chief Sonia Gandhi.

"Certainly this is a serious issue that has to be raised in all forums including parliament," senior BJP leader Arun Jaitley told Reuters.

"It was a case of corruption that almost went to the doorstep of the prime minister ... As and when parliament functions, we will certainly raise it."

The latest resurrection of the scandal was sparked by a court case over a plea by the Central Bureau of Investigation (CBI) to end its investigation into the allegations surrounding a contract with Swedish arms firm AB Bofors.

The CBI has argued that it did not have sufficient evidence of kickbacks, and repeated attempts to extradite its main suspect, Italian businessman Ottavio Quattrocchi, who was a friend of Sonia and Rajiv Gandhi, had failed.

But the opposition have seized on a report this week by India's income tax department that found evidence of payments made to Quattrocchi and Bofors agent Win Chadha, totalling USD14.7 million, media reported.

"Clearly, the entire fraud, which had been perpetrated by the CBI at the behest of its political masters in the Congress stands unravelled," Jaitley said after the report was released.

"We are not concerned with any individual. Punish the guilty, rip them apart. We are concerned only with our fair name and that of Rajiv Gandhi," said a senior Congress leader, who declined to be identified.