New Delhi, Sep 23 (IANS): India's government auditor has pulled up the Indian Air Force (IAF) and an Israeli drone manufacturer for financial loss in procurement of UAV Rotax engines and recommended a probe into the matter to fix the responsibility.

The Comptroller and Auditor General's (CAG) Audit Report on Air Force - Defence Services, tabled in the Parliament on Wednesday, flagged irregularities in purchase of aero engines for Unmanned Aero Vehicles.

"IAF concluded a contract in March 2010 with M/s Israel Aerospace Industries (IAI) for supply of five 914F (certified) UAV Rotax engines at a cost of Rs 87.45 lakh per engine," it said.

The audit, however, noted that the Aeronautical Development Establishment (ADE), under the Defence Research and Development Organisation, had, in April 2012, procured the same variant of Rotax engine at Rs 24.30 lakh per engine.

Also, the average price of this engine in the international market ranged between Rs 21 lakh and Rs 25 lakh.

"As a result, the vendor gained an undue benefit of Rs 3.16 crore as it supplied the five contracted UAV engines at more than three times the market price or the price offered to the DRDO unit," the CAG stated.

The audit also noted that the vendor resorted to mislabelling and supplied uncertified engines to the IAF instead of the contracted certified engines.

"There were many reported accidents involving these uncertified engines including loss of one UAV in a flying accident," the report stated.

The auditor recommended investigation into the matter and fixing of responsibility for wrongful supply and acceptance of mislabelled engines by IAF.

About upgradation of medium lift helicopters, the CAG stated that the upgradation of Mi-17 helicopters, proposed in 2002, to overcome the operational limitation of these helicopters could not be achieved even after 18 years.

As a result, these helicopters were flying with limited capability, thus compromising operational preparedness during these years.

Due to poor planning and indecision at various stages of procurement, the Defence Ministry took 15 years to enter (January 2017) into the upgradation contract of 90 Mi-17 helicopters with an Israeli company.

The contracted delivery of these upgraded helicopters was to start from July 2018 and be completed by 2024.

The CAG noted that after upgradation, 56 of these helicopters would be left with less than two years of life and would be phased out by 2024.