Toxic Karti hand in INX foreign funds sends CBI to his doorstep 

Sleuths swoop down on residences of former Finance Minister P Chidambaram and his son at 14 locations across India; misconduct in grant of FIPB nod to media house at heart of the probe

Published: 17th May 2017 01:14 AM  |   Last Updated: 17th May 2017 04:54 AM   |  A+A-

Karti P Chidambaram addresses the media in Chennai on Tuesday | ROMANI AGARWAL

By Express News Service

CHENNAI/ NEW DELHI: The Central Bureau of Investigation (CBI) on Tuesday raided residences owned by former Finance Minister and senior Congress leader P Chidambaram and his son Karti P Chidambaram at 14 locations across the country, including in Tamil Nadu, Gurugram and Mumbai. The raids were carried out in connection with alleged criminal misconduct in granting Foreign Investment Promotion Board (FIPB) approval to investments received by INX Media, formerly owned by Peter and Indrani Mukherjee.

Sources in the CBI told Express the raids were ‘particularly’ on Karti, against whom an FIR has been filed. According to the FIR, Karthi used his influence over FIPB officials to help INX Media get FIPB clearance illegally. INX had violated FIPB norms and was under scrutiny of the Income Tax department’s investigation wing. Besides, Karti has been charged with misinforming the IT wing that sought clarification on the issue.

Though the FIR does not name Chidambaram, it alleges the “deceitful and fallacious proposal” was received favourably by Finance Ministry officials and “approved by then Finance Minister.” Reacting to the raids, Chidambaram lashed out at the Centre, charging it with trying to silence him. Karti claimed no documents were seized from him. “They cannot prove any charges against me. I have not done anything wrong,”

So, what are the irregularities alleged by the CBI? INX Media had tried to get FIPB approval on March 2007 to transfer 46.216 per cent of its equity share capital on “converted” basis to three NRI investors under the FDI route. It also sought approval for downstream financial investment to the extent of 26 per cent of INX News’ outstanding share capital. While FIPB gave clearance to inflow of FDI to the extent of Rs 4.61 crore, it denied approval for the downstream investment.

However, INX Media allegedly violated the conditions and went for downstream investment, which included indirect foreign investments. The move generated more than Rs 305 crore FDI in INX Media, against the approved foreign inflow of Rs 4.62 crore, by issuing shares to foreign investors at a premium of more than Rs 800 per share.Full text of FIR: P2

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