How are Karti Chidambaram & P. Chidambaran Connected to the INX Media Case?

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The Delhi High Court on Tuesday (20 August) mentioned that the INX Media case is a classic case of money laundering, for which senior Congress leader P. Chidambaram also faces arrest by CBI for alleged violations in the FIPB (Foreign Invesment Promotion Board) clearances to the media group for getting overseas funds amounting to Rs 307 crore.

If you are wondering what this case is all about and why are the Chidambaram father-son duo dragged into this, here we share all about it –

What is the INX Media Case?

It all started in May, 2017, when ED lodged an ECIR (Enforcement Case Information Report) equivalent to a police FIR against Karti Chidambaran, son of P. Chidambaram along with INX Media (now called 9X Media Pvt Ltd), it’s directors Peter Mukerjea – Indrani Mukerjea (currently in jail in connection with Sheena Bora murder case) and few others under 2002 act of PMLA – Prevention of money laundering act.

It was based on this ED material, the CBI subsequently fired a police FIR on May 15, 2017 claiming irregularities in the clearance awarded to INX Media by FIPB (Foreign Investment Promotion Board) for getting Rs. 307 crores in 2007.

How are Karti Chidambaram and P. Chidambaran Connected to the INX Media Case?

In March, 2007, INX Media had approached FIPB chairman to seek permission for issuing equity shares through the FDI route to three NRI investors based in Mauritius – New Silk Route PE Mauritius LLC, New Vernon Pvt Equity Ltd and Dunearn Investment (Mauritius) Pte Ltd. According to the FIR, this money was sought for making and producing multiple TV channels.

Next, the FIPB approved the media group’s proposal – an FDI inflow of Rs. 4.62 crore but refused the proposed downstream investment to the extent of 26% of the issued and outstanding equity share capital of INX News Pvt Ltd, a subsidiary of INX Media. However, going by the CBI FIR, INX media in spite of the disapproval went ahead with the downstream investment and generated FDI/NRI inflow around Rs. 307 crores by issuing shares to overseas investors in between August’07 and May’08 at a premium of Rs. 862.31 per share which was 86 times more than its face value.

After the IT probe, when FIPB sought clarifications from the media group, they allegedly sought the help of Karti Chidambaram to scuttle the entire probe. According to CBI, Karti had allegedly received money around $1 million to facilitate the process. The CBI also recovered vouchers around the same amount in the name of a firm that was indirectly owned by him. Post this recovery, he was arrested by CBI in February 2018 and released on bail in March.

Now that the Foreign Investment Promotion Board (FIPB) was housed in the Department of Economic Affairs, Ministry of Finance and P. Chidambaram was the Finance Minister during the years of the INX Media money laundering mess, he is alleged to be a co-conspirator with his son Karti to help the media group to evade all the punitive measures for not having necessary approvals from the FIPB.

Karti not only exercised influence over FIPB officials in the INX Media case but also extended undue favours by asking them to apply for a fresh FIPB approval on the downstream investment that was already received by it. During this time, the media group was granted FIPB permission in violation of the norm with the help of P. Chidambaram as alleged by the CBI in its report.

P. Chidambaram was questioned by ED in December 2018 and January 2019 in connection to this case two months after the ED attached Karti Chidambaram’s assets worth Rs 54 crore in India, Spain and UK in connection with the INX media case of money laundering, which the senior Chidambaram termed as bizarre.

In March 2018, Indrani Mukerjea in a statement recorded under Section 164 of the CrPC told CBI how a deal of $1 million was struck between the Mukerjeas and Karti Chidambaram in favour of INX Media to secure approval from the FIPB. Recently on June 11, 2019, she also turned approver in the INX Media case. According to the reports, to turn approver, Indrani had pleaded for pardon in the case in exchange of true and full disclosure.

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About Deepti Verma 249 Articles
Deepti Verma is a Political/Social Writer with an opinion on almost everything! Follow @universal_rover