Defence Ministry may suspend dealings with SMPP

New Delhi: The defence ministry is likely to suspend all business dealings with pulp packaging to drones manufacturer SMPP that is being probed by the Central Bureau of Investigation (CBI) for alleged corruption to secure a Rs 500-crore deal with public sector entity Munitions India Limited (MIL).

As per new guidelines promulgated this year, entities that have been named in a First Information Report (FIR) by the CBI or other central investigative agencies face a suspension of business dealings, with the secretary of the department authorised to take action as soon as information on the issue is received.

The order of suspension of business dealings is also likely to be extended to all its allied firms and in case its joint ventures or consortiums are suspended, all partners may also be deemed to be suspended. As per the guidelines, the period of suspension could be six months, which can be extended by the secretary concerned.


As reported by ET, SMPP has been accused of bribing an MIL official to secure a ₹500-cr contract, with CBI arresting its promoter Ashish Kansal as well as other associates. SMPP started as a pulp packaging company that diversified into making bullet proof jackets and helmets for the armed forces.