In a significant step, the government has decided to lift the ban on dealings with Italian firm Leonardo (earlier name Finmeccanica) that was banned in connection with the Rs 3600 crore VVIP chopper scam.

Government sources told ANI on Sunday that the ban has been lifted in dealing with the company with conditions. As per the decision, the investigation against the company by the Central Bureau of Investigation and the Enforcement Directorate would continue.

"The company would also not be allowed to make any financial claims on the Government of India based on any agreements signed earlier and it will have to start afresh after the ban is lifted," the sources said.

India had put on hold the dealings with the company in 2013-14 during the tenure of the UPA government when European agencies arrested individuals for their role in the Rs 3600 crore deal to supply 12 AW-101 helicopters to India for ferrying VVIPs.

Sources said that the decision was made by the defence ministry based on the request made by the Italian firm and after consulting the Law Ministry and other agencies.

Even though the corruption case was related only to Agusta Westland, dealings with the entire Finmeccanica group were put on hold. This included deals for black shark torpedoes which were cleared to be acquired by the Indian Navy at that time.