In India, we have learned of certain improper payments made over a period of years in connection with sales to government customers by employees of our majority-owned subsidiary in that country

Xerox

"I did get some papers from the Company Affairs Secretary yesterday (Wednesday) and I quickly gave him instructions to probe the matter," Indian Finance Minister Jaswant Singh said on his first day in office.

Mr Singh also offered assurances that the Xerox case was not a sign of wider corporate corruption.

Vinod Kumar Dhall, India's Company Affairs Secretary, told CNBC television his agency would inspect Xerox's accounts in accordance with the Companies Act.

"It has to be a quick inspection with a view to ascertain the actual facts," he said.

"There are penalties provided (in the act). The penalties are there in terms of financial fines.

"Some sections (of the act) provide for penalties in terms of imprisonment also. "

Cash-for-copiers

The US-based multinational admitted Xerox Modicorp, its Indian unit, made payments in its delayed annual report.

The filing also showed it had incorrectly declared equipment sales between 1997 to 2001 by billions of dollars.

"In India, we have learned of certain improper payments made over a period of years in connection with sales to government customers by employees of our majority-owned subsidiary in that country," the company said.

"We estimate the amount of such payments in 2000, the year the activity was stopped, to be approximately $600-700,000."

According to the report, $100-200 at a time was paid to Indian government officials to clinch orders, indicating a minimum of 3,000 payments.

Xerox holds a 68% stake in the unlisted joint venture with Indian company SpiceCorp.

Mr Singh, who was India's foreign minister, swapped places with incumbent finance minister Yashwant Sinha on 1 July in a Cabinet reshuffle.