NAGPUR: DATASEL S.R.L., the Italian defence company acquired by Nagpur-based Neco Defence Munitions Pvt. Ltd. in 2024, has issued a detailed clarification following recent international media reports surrounding its ammunition contracts with Estonia’s Centre for Defence Investments (ECDI).
The controversy has gained international attention after Estonia’s Defence Minister Hanno Pevkur resigned amid criticism surrounding defence procurement and an ammunition contract involving DATASEL.
According to international media reports, the Estonian side had paid approximately €70 million in advance under the disputed contracts. DATASEL, however, has now disputed that figure and provided its own account of the transaction.
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DATASEL: “We received approximately €59 million”
In its clarification, DATASEL states that, contrary to the €70 million advance figure reported in international media, it received approximately €59 million in advance payments.
The company further says it had already supplied and invoiced materials worth approximately €58 million against those payments.
This is one of the central points in DATASEL’s response to the coverage surrounding the contract.
Company disputes reason for termination
DATASEL says the contracts, entered into with ECDI in 2024 and 2025, involved a complex international supply chain requiring multiple governmental approvals, regulatory clearances, procurement processes and coordination across jurisdictions.
The company claims it was subsequently informed that funding available through a European funding mechanism had lapsed, affecting ECDI’s ability to make balance payments and accept the remaining deliveries.
DATASEL says that by the time the contracts were terminated, some material was already ready for delivery, additional quantities were in production and substantial volumes had already been specifically procured.
The company therefore disputes ECDI’s stated basis for termination and argues that the underlying issue was lack of funds rather than delivery or quality problems.
Quality allegations challenged
DATASEL has also rejected questions surrounding the quality of the supplied ammunition.
According to the company, multiple lots had undergone the inspection process stipulated in the contracts and had been inspected by ECDI representatives before the goods were lifted by ECDI.
DATASEL says certain quality or defect-related concerns were raised only after the contracts had been terminated. The company characterises these allegations as an afterthought intended to avoid contractual obligations.
These remain contested claims, with the underlying dispute still before legal and arbitration authorities.
DATASEL disputes Ukraine connection
Another important issue concerns reports that the ammunition was purchased to support Ukraine.
DATASEL has specifically challenged this description.
The company says that, under its contracts with ECDI, Estonia is the end user of the goods. ECDI operates under the supervision of the Estonian Government, according to the company’s statement.
International reporting, however, has linked the procurement to broader European efforts to supply ammunition to Ukraine.
The distinction between the contractual end user and the broader purpose of the procurement programme is therefore significant in understanding the dispute.
Nagpur connection
The controversy has an Indian and, specifically, a Nagpur connection because DATASEL was acquired in 2024 by Neco Defence Munitions Pvt. Ltd.
DATASEL says that following the acquisition, it transformed from a small Italian company into an international defence business, expanding its partnerships and taking on complex multi-country defence programmes.
The company claims that since the acquisition it has executed contracts worth more than €110 million, while contracts worth approximately €190 million are currently at various stages of execution.
The company’s transformation, it says, has been led by founder and Executive Director Ing. Sandro Pazzini, who has more than 40 years of experience in the Italian defence industry, along with a team led by Sagar Jaiswal.
Dispute now before court and arbitration
DATASEL says the contract termination dispute is currently sub judice before the competent court and arbitration tribunal.
The company has submitted detailed responses and says it has also filed counterclaims against ECDI involving double-digit millions of euros.
Because the proceedings are ongoing and confidential, DATASEL says it will not comment on specific legal arguments or evidence.
The company maintains that it complied with its contractual obligations and believes the allegations made by ECDI have no merit.
The bigger question
The DATASEL clarification adds another dimension to what has so far been reported primarily as a failed or disputed European ammunition procurement.
The Estonian side and international reports have raised questions over procurement, deliveries, quality and advance payments.
DATASEL’s response presents a substantially different version: €59 million received rather than €70 million, approximately €58 million worth of material supplied and invoiced, material already procured or in production at termination, and funding constraints rather than delivery or quality issues as the fundamental cause of the dispute.
With the matter now before court and arbitration, the competing claims have yet to receive a final legal determination.
Nagpur Today takeaway
The Estonia-DATASEL dispute is no longer simply a €70-million ammunition controversy. It is now a contested international defence-contract dispute involving an Italian company owned by a Nagpur-linked defence group, millions of euros in payments and counterclaims, and sharply different versions of why the contracts were terminated.
DATASEL’s statements in this article represent the company’s position and have not been treated as independently established facts. The legal proceedings remain ongoing.
