(Updates with Indian defence ministry official's comments)
By Sruthi Gottipati
NEW DELHI, July 30 India's top crime-fighting agency said on Wednesday it would press ahead with an investigation into a scrapped helicopter contract with Finmeccanica, a day after prosecutors in Italy agreed to settle legal proceedings against the Italian firm.
India cancelled the 560 million euro ($751 million) order with Finmeccanica's unit AgustaWestland for 12 top-end helicopters in January, after Italian prosecutors alleged the defence group had paid bribes to Indian officials to win the contract.
Finmeccanica has denied the allegations, and said on Tuesday the Indian probe had been discontinued.
But Kanchan Prasad, a spokeswoman for India's Central Bureau of Investigation (CBI), told Reuters the development in Italy did not affect the Indian investigations.
"Why should it change?" she said. The investigation was "at an advanced stage, that's all that I can say".
The CBI was looking into allegations of abuse of official power and following money trails from abroad. Charges had not yet been filed, said Prasad.
The Indian defence ministry has asked for a report from the Indian embassy in Rome, an official said. "What has happened in Rome is between Finmeccanica and the prosecutor. This no way affects us," he said.
Finmeccanica also said on Tuesday its helicopter unit AgustaWestland would apply to the Italian court for a nominal fine to settle proceedings.
Finmeccanica, one of Italy's biggest private employers, said in a statement: "This decision is not in any way an admission of any wrongdoing or liability".
The case has embarrassed the New Delhi government and dented Finmeccanica's reputation, putting AgustaWestland at risk of being blacklisted from India, one of the world's fastest-growing defence markets.
India, where a number of defence deals have been hit by corruption allegations over the past two decades, took delivery of three of the helicopters before the deal stalled.
($1 = 0.7461 euro) (Additional reporting by Nigam Prusty,; editing by Ron Popeski and John Stonestreet)