NEW DELHI: The continuing Paradise Papers expose by the Indian Express newspaper has found that the business group with the largest number of offshore entities in Bermuda law firm Appleby's records is the Khemka family of the SUN group.
Apart from the Khemkas, a fresh set of stories from the probe of 13.4 million leaked documents from Appleby and Singapore's Asiaciti pertain to Indian and Indian-origin individuals and corporates ranging from the Hindujas to the Caparo Group and Dayanidhi Maran to Karti Chidambaram -- apart from a clutch of media firms.
The cache, named "Paradise Papers", was obtained by German newspaper Süddeutsche Zeitung and probed by the International Consortium of Investigative Journalists (ICIJ) -- in partnership with 96 news organisations.
The papers provide an insight into "tax havens across the world which help the global rich and powerful, including from India, to move their money abroad", the report said.
Records investigated by The Indian Express show that the Khemka family "has registered nearly 100 entities mostly in the British Virgin Islands and New Jersey".
The group is headed by patriarch Nand Lal Khemka, 82, who is shown as beneficiary or "officer" for 17 of these entities. One son, Shiv Vikram, is the "officer" of 104 offshore entities and another, Uday Harsh, of 102 entities.
Interestingly, Shiv Vikram, who is vice chairman of the Gurgaon-based SUN Group, claims to be close to the Russian establishment and has been mentioned in news reports as seeking to emerge as a key intermediary in India-Russian defence deals. His group has widespread interests in Russia, especially in the brewing, energy, mining, aerospace and infrastructure sectors.
According to the Express report, Appleby has listed Khemka, along with his two sons and their flagship foundation -- The Nand and Jeet Khemka Foundation -- as PEPs (Politically Exposed Persons).
The report says that records of "risk rating" lists show that "Appleby mentioned the reasons why the Khemka family has been assessed as 'high risk' or 'medium risk' among its clients, at least until 2014. At a meeting in March 2009, many objections or observations were made by Appleby related to as many as 47 entries for Nand Lal Khemka and his entities".
In one instance, the report says, there is an entry that records how Khemka has "the potential of purchasing a yacht".
Other key findings, from records examined by The Indian Express, are:
- A 600,000 pound "distribution" to University of Pennsylvania with a request from Appleby for Khemka and the representative of the Khemka trust to provide a "detailed report" on how the funds were used.
- A 2007 remittance of $18 million to Khemka for purchase of a property in India. Appleby sought valuation reports, reports from lawyers and copies of the tax advice. A separate compliance report mentions the purchase of apartments in Qatar with a clarification that the purchase was done from personal funds of the family.
- A query regarding the transfer of EUR 2.4 million for the "purchase of art". Appleby officials are asked to contact the art company and confirm the price.
- A $4.34 million payment made by the trust to the Public Health Foundation of India with a note to determine who controls the charity. Later, a note states that this payment was not made and would not be made from this "structure".
There are also payment reminders sent by Appleby to the SUN Capital Partner Group and the Nand and Jeet Khemka Foundation. One reminder dated December 15, 2015, lists 13 payments totalling 65,800 pounds due to Appleby.
Khemka still serves as chairman of Indag Rubber Ltd, a company listed in India with a market capitalisation of over Rs 550 crore. It had revenues of Rs 183.9 crore in the year to March 31, 2017, as against Rs 253 crore in the previous year.
Reached for a response, Khemka has been quoted as saying: "My sons Shiv and Uday have been NRIs for over 35 years. SUN Group is a private investment group which was founded by them over 30 years ago and has been working across the globe since that time. SUN has made many separate investments using specific corporate vehicles over these years. As a global group owned by shareholders who have been NRIs since well before incorporation of the group, the question of RBI permissions, etc., with respect to the establishment and jurisdiction of the group does not arise."
He said that the Nand and Jeet Khemka Foundation was a supporter of philanthropic causes, but is not "involved in the purchase of properties and art. Any such purchases have been made with personal funds".