INX Media case: Former finance minister P Chidambaram, who is under the Central Bureau of Investigation's (CBI) custody since last Thursday (August 22), has by far been non-cooperative during the agency's interrogation. Chidambaram was grilled by the CBI over the Foreign Investment Promotion Board (FIPB) approvals granted by the finance ministry under him from 2004-2008 and 2012 to 2014. When the probe officials questioned him about the INX Media case approval files, Chidambaram remained evasive and silent.
According to IndiaToday.In, the CBI gave him the list of all the clearances granted by him while he was the finance minister under the UPA regime and asked to explain the procedures followed during the FIPB approvals. Sources told India Today that the CBI is likely to seek the extension of Chidambaram's custody. However, the agency will also closely monitor the Supreme Court (SC) proceedings in which the CBI's arrest has been contested by the former finance minister through his lawyers.
The Enforcement Directorate (ED), which has been asking for Chidambaram's custodial interrogation, has opposed the anticipatory bail plea filed by his lawyer in the SC. Both the matters will be heard by the SC on Monday. Former DEA secretary D Subbarao had told the CBI that in the INX Media case, the alleged "violations" were not pointed out to the FIPB, official records reveal.
Subbarao, who was the FIPB chairman when it cleared the INX Media files, recorded his statement under Section 161 of the CrPC. "The non-compliance of the procedure by INX Media was not brought to the notice of the board, hence they were not aware of it," he said. "The two pages note prepared by the FIPB secretariat annexed with the application of INX Media also did not have any violation or non-compliance details," Subbarao said in his statement to the CBI.
"Everything was clear in papers and hence the board recommended for approval to the then finance minister," he added. The allegations in the INX Media case are that on May 31, 2007, the company was granted an FIPB approval in to bring in Rs 50 crore FDI from Mauritius. However, the tax officials discovered the company had brought in Rs 305 crore instead.
Indrani Mukerjea, who headed INX Media at that time sought favour from Chidambaram's son Karti to help her and her husband Peter Mukerjea in an Income Tax (I-T) Department investigation against the INX Media by using his father's clout to influence the probe against the company. However, she turned approver in the case in July this year. In her application to turn approver, Indrani had prayed for pardon in the case in exchange of full and true disclosure.
She has alleged in her statement that Chidambaram promised a post-facto FIPB approval and demanded her and Peter to pay Rs 5 crore towards an associate company of Karti Chidambaram. The negotiations began in June 2008 and the payments were made during September 2008. Subsequently, the FIPB granted the approval to INX Media on November 11, 2008.
The approval, which was signed by then under-secretary of FIPB, R Prasad said, "Foreign Equity Participation was increased from 12.82 per cent to 24.83 per cent in paid capital for the sum of Rs 7,37,50,000 of INX Media Pvt Ltd." The findings of the probe indicate towards a company called Advantage Strategic Consulting Pvt Ltd (ASCPL), allegedly owned by Karti, which had got the said bribe of Rs 5 crore.
This amount was received in the guise of consultancy charges from other companies/individuals that also received FIPB approval from the ministry of finance. The investigations further disclosed that ASCPL never had the requisite staff to provide any consultancy or tender advice. "Further documents suggests that since inception M/S ASCPL is being controlled by Karti Chidambaram," said a source.