Tyagi was briefly named in an Italian Investigation into bribes paid to secure a Helicopter Contract, although further information created doubts in the matter.

[1] As per the unverified testimony of an Italian businessman, he received illegal payments to change the technical specifications of the helicopters which favored AgustaWestland which was finally awarded the deal.

However, further investigation showed that the technical specifications were changed prior to his tenure on the orders of Brajesh Mishra, the National Security Adviser, in the Prime Minister's office (PMO).

[6][7] In April 2016, an Italian court said there was "reasonable belief that corruption took place" in the 2010 VVIP helicopter deal and that former Indian Air Force chief SP Tyagi was involved.

In January 2018, the Italian courts said there was "insufficient proof that any bribery took place" and acquitted Giussepe Orsi (ex CEO) and Bruno Spagnolini (head of helicopter division) of all charges.