The agencies are probing how Karti managed to get clearance to the tune of Rs 305 crore from the Foreign Investment Promotion Board (FIPB) in 2007 when his father was the finance minister.
The Supreme Court on Tuesday allowed Karti Chidambaram, who is the son of former finance minister P Chidambaram, to travel to the United States, Spain and Germany in May and June. He is facing trial in the INX Media money laundering case. A Bench headed by the Chief Justice of India. Ranjan Gogoi, asked Karti Chidambaram to deposit a security deposit of Rs 10 crore.
Karti has been questioned on several occasions in the case being probed by the ED as well as the Central Bureau of Investigation (CBI). The agencies are probing how Karti managed to get clearance to the tune of Rs 305 crore from the Foreign Investment Promotion Board (FIPB) in 2007 when his father was the finance minister.
The agency had registered the FIR against Karti, his company Chess Management Services, Peter Mukerjea and Indrani Mukerjea, INX Media, Advantage Strategic Consulting Services and its Director Padma Vishwanathan.
Both CBI and the Enforcement Directorate are investigating the foreign investment clearance granted to the Aircel-Maxis deal in 2006 and the INX Media in 2007 when Chidambaram was the finance minister in the UPA government. The government has already given sanction to prosecute him in Aircel Maxis case.
Chidambaram had denied allegations of any wrong doing in clearing the foreign investment proposals of these companies. According to the CBI, INX Media stated in its records that Rs 10 lakh was given to Advantage Straetgic Consulting (P) Limited, a firm "indirectly" owned by Karti, for management consultancy charged towards FIPB notification and clarification.
The FIR also alleges that invoices of approximately Rs 3.5 crore were raised in favour of the INX group in the name of other companies in which Karti had substantial interests "directly or indirectly".
The allegations levelled by the CBI are based on the information given by "source", the FIR has claimed. INX Media was seeking investment from Mauritius, an official explained. The investment was allowed by the FIPB board and the finance minister with the condition that only Rs 4.62 crore could be received. For investment in INX News Pvt Ltd a separate proposal was required.
The company allegedly violated the conditions set by the FIPB and received investment to the tune of 26 per cent in the capital of INX News which included foreign investment. It allegedly generated more than Rs 305 crore of FDI in INX Media against the approved inflow of Rs 4.62 crore by issuing shares to foreign investors at a premium of more than Rs 800 per share.
The violation prompted an Income Tax department probe. INX Media claimed that the investment was done as per FIPB conditions. In order to wriggle out of the situation without any punitive action, INX Media entered into criminal conspiracy with Karti whose father was the finance minister of the country, the agency has alleged.
Officials, by virtue of the influence exercised over them by Karti, not only ignored serious illegalities on the part of INX Media but also showed undue favours by abusing their official position and advised the company to file for a fresh clearance, the FIR claimed.
The officials of the FIPB unit ignored the request of the Revenue Department to investigate how the investment was made by the company without FIPB approval, it alleged. The company, on the advice of FIPB officials, allegedly filed a fresh request which was cleared by the Finance Ministry and the finance minister.
"Such deceitful and fallacious proposal was favourably considered by the officials of Finance Ministry and approved by the then Finance Minister," it has alleged.
Chidambaram had issued a strong rebuttal to the allegations after the FIR was filed and searches were carried out on May 16, 2017. His said the government was using the CBI and other agencies to target his son. FIPB approval was granted in "hundreds of cases", the senior Congress leader had said.