New Delhi: The CBI has booked NDTV promoters Prannoy Roy and Radhika Roy and others for allegedly violating Foreign Direct Investment (FDI) rules in a 2007-09 investment, a charge denied by the company.
Besides Prannoy and Radhika Roy, the agency registered an FIR against then CEO Vikramaditya Chandra as well as unidentified government officials on charges of criminal conspiracy, cheating and corruption, officials said on Wednesday.
A CBI team conducted searches at Chandra’s residence on Wednesday, the officials said.
This is the second FIR against NDTV as the CBI is already probing a case of alleged bank loan default against the company.
Under the CBI scanner are mainly two transactions pertaining to investments in foreign subsidiaries of NDTV — NDTV Networks Plc (NNPLC) and NDTV Networks BV — based in London, United Kingdom, and Netherlands respectively, the officials said.
The agency has alleged that Fuse Media Holding LP and Jefferies International brought in funds to the tune of USD 120 million in NNPLC. While Fuse media purchased 4.5 to 5% in NNPLC in March 2007, funds by Jefferies were brought in by using step up coupon convertible bonds in May 2007, the CBI said.
The second set of transactions mentioned in the CBI FIR pertains to pumping of $150 million in Netherlands-based NDTV Networks BV by NBCU, a subsidiary of General Electric, US, the officials said. NBCU transferred the amount from the account of its subsidiary Universal Studios lnternational BV, Netherlands on 23 May 2008, they said.
Through same transaction, NBCU also acquired a 26% stake in NDTV Networks Plc (NNPLC), said the CBI.
The convertible bonds worth $100 million were repaid by paying $72.40 million to investors in November 2008 while 26% share holding of NBCU in NNPLC was bought back by purchasing shares of NDTV Network International Holding BV, Netherlands from it for $12,472,750 to Universal Studio BV on 26 October 2009. These transactions are allegedly sham transactions used for routing money in India, they said.
“It is alleged that NNPLC got approval from the FIPB Board in violation of laid down FDI provisions for Foreign Direct Investments (FDl) worth $130-160 million. Subsequently, NNPLC received total FDI worth $163.43 million till September 2009. Further, it invested the said amount in various subsidiaries of NDTV through a web of complex transaction,” the CBI has alleged.
The agency has alleged that Prannoy, Radhika Roy, KVL Naryanan Rao (since expired) and Chandra had entered into criminal conspiracy with unknown public servants with the object of bringing tainted money of unknown public servants through a web of complex transactions through the FDI route.
In a statement denying the charges against Prannoy and Radhika, NDTV strongly condemned CBI’s allegations.
“NDTV and its founders have full faith in India’s judiciary at this crucial time and remain committed to the integrity of the company’s journalism. Attempts to silence free and fair reportage through malicious and fabricated charges will not succeed. This is not about a company or individuals but about a larger battle to maintain the freedom of the press, something which India has always been renowned for,” the statement said.
As part of “the continued persecution of free press”, NDTV’s statement said, a new CBI case has been filed about a $150 million investment in NDTV’s non-news business by NCBU, then owned by General Electric. “The case makes the ludicrous charge that the transaction, declared to all relevant authorities in the US and India, laundered money for unknown public servants,” it said.
The FIR against Prannoy, Radhika and others is an outcome of a preliminary enquiry registered by the agency in 2016, the CBI officials said.
It is alleged that during May 2004 to May 2010, NDTV floated around 32 subsidiary firms all over the world, mostly in the tax havens of Holland, the United Kingdom, Dubai, Malaysia, Mauritius, etc.
The CBI said most of these companies that are promoted by Prannoy and Radhika Roy, allegedly had no business transaction and were meant for financial transactions to bring funds from abroad.
Terming the transactions a “sham”, the agency alleged that funds were invested by unidentified public servants through NDTV and laundered back to India through multiple layers of complex transactions and shell companies. “Proceeds of corruption of unknown public servants was invested through NDTV Ltd,” it alleged.