INX Media case: Karti Chidambaram to appear before CBI today

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NEW DELHI: Congress leader Karti Chidambaram, the son of former Union Minister P Chidambaram, will appear before the CBI today following directions to do so by the Supreme Court.

Karti Chidambaram is wanted in a corruption case relating to FIPB clearance to INX media for receiving overseas funds to the tune of Rs 305 crore. INX had approval from the FIPB board for bringing in only Rs 4.62 crore.

On Tuesday the Madras High court refrained from granting any relief to Chidambaram for quashing of the FIR filed by the CBI and the subsequent summons issued by it in the INX Media case.

Chidambaram will be accompanied by a lawyer at the CBI headquarter but not while he is being questioned. The lawyer will sit in the adjoining room.

This is as per the Supreme Court ruling of August 18 directing Chidambaram to not only appear before the federal agency but had earlier that week quashed a Madras High Court stay on a look out circular.

The high court had stayed the LoC issued by the CBI following Chidambarams’s contention that the LoC had been issued even before the date  given for appearance in the CBI’s summons.

SEARCHES

The CBI lodged an FIR on May 15 and carried out searches in Karti Chidambaram’s offices and residence as well as the premises of his friends and acquaintainces on May 16. It moved the Supreme Court when Chidambaram did not attend to summons of the CBI for the second time on July 19.

The CBI’s FIR says the FIPB nod was fallacious but it was cleared due to undue influence on finance ministry officials by Karti Chidambaram. In its application to the FIPB, INX had said it would  “make a downstream financial investment to the extent of 26% of the issued and outstanding equity share capital of INX News Private Limited”.

But the approval by FIPB was of only Rs 4.62 crore and not of downstream investment. The FIR primarily alleges that “INX Media deliberately and in violations of the conditions and approval i) made a downstream investment…and ii) generated more than Rs 305 crore foreign direct investment in INX Media Pvt Ltd against the approved foreign inflow of Rs 4.62 crore “.

Interestingly, this anomaly was noticed in 2008 and the FIPB informed the Income Tax Department that the matter is being probed.

“In their endeavour to show undue favour..the officers/officials of the FIPB unit also ignored the request of the Department of Revenue to investigate the matter as to how downstream investment in INX News Pvt Ltd was made by the company without FIPB approval,” the FIR alleges.

I’M THE REAL TARGER, SAYS P CHIDAMBARAM

Karti Chidambaram denies ever meeting FIPB officials or being a director or share holder in Advantage Strategic Consulting Private Limited, the firm through which the alleged Rs 10 lakh bribe money was paid. The CBI’s case is the money was routed through this company to hide the real identity of the ultimate beneficiary.

Former finance minister P Chidambaram’s contention is that he is the real target of the probe which is an attempt to harass leaders of the opposition. If there was really a scam then why weren’t the six officials who comprised the FIPB also named, he asked in a statement.

“FIPB approval is granted in hundreds of cases. The five secretaries who constitute the FIPB, the officials of the FIPB Secretariat and the competent authority in each case are the public officials. There is no allegation against any of them. There is no allegation against me. Approval or refusal to a case was in accordance with the recommendations of the FIPB,” Chidambaram said.