Investigation agencies said the arrest of Karti Chidambaram followed a statement by accused Indrani Mukerjea in which she had alleged that P Chidambaram, while he was Union Finance Minister, had asked her and her husband Peter Mukerjea to help his son’s business.
In her statement recorded by the CBI under Section 164 of the CrPC, Indrani Mukerjea, who is already behind bars in the Sheena Bora murder case, alleged that a deal of USD 1 million was struck between Karti and the Mukerjeas to swing FIPB approval in favour of INX Media.
While P Chidambaram made no comment Wednesday on his son’s arrest or the claims of the CBI, his party came to his defence. Senior Congress leader Kapil Sibal called Karti’s arrest “malafide” and said it was done to harass P Chidambaram. “This is complete vendetta politics. This is completely malafide,” he said.
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The CBI and Enforcement Directorate also claimed that searches of premises linked to the accused in the case led to discovery of vouchers of payments made by INX Media to companies connected to Karti, and to foreign entities which received close to USD 700,000 in Greece and Spain. All vouchers were signed by Peter Mukerjea.
According to CBI and ED, Indrani and Peter have said in their statements that they met P Chidambaram at his North Block office in connection with FIPB approval for FDI in INX Media. Chidambaram, the agencies claimed, asked the Mukerjeas to “help the business of his son Karti, and to make foreign remittances for this purpose”.
The Mukerjeas, the CBI and ED claimed, also admitted to “have met Sh. Karti Chidambaram in Hotel Hyatt in Delhi, where a demand for illegal gratification of $1 million was made. Sh. Karti Chidambaram suggested the names of Chess Management and Advantage Strategic as alternatives to make payments.”
While Chess Management Global Pvt Ltd was engaged by INX Media to advise in the matter, Advantage Strategic Consulting Pvt Ltd (ASCPL) was made a payment of Rs 10 lakh as consultancy fee. ASCPL, the CBI said, was “indirectly controlled by Karti”.
The ED investigators claimed that “ledger extracts produced by INX Media Ltd showed that the payment (of Rs 10 lakh) has been made for ‘reply towards FIPB notification and clarification’.”
During the probe by CBI and ED, INX Media also “produced emails and letters sent to Sh B Sai Chandravardhan, VP, Chess Management Services Pvt Ltd on the FIPB issue”.
“We have about 200 emails that establish the connection between Chess Management and ASCPL and FIPB negotiations,” a probe officer said.
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Four invoices, connected to the alleged illegal gratification paid for FIPB approval in the matter, were drawn by ASCPL (Rs 35 lakh), its Singapore subsidiary (USD 20,000), Northstar Software Solutions Pvt Ltd (Rs 60 lakh) and Greece-based Geben Trading Ltd (USD 500,000).
These vouchers, recovered from the computer of Karti’s chartered accountant Bhaskararaman, were from September 2008, the time when INX Media Ltd applied for fresh approval for downstream investment in INX News Ltd. The Finance Ministry later cleared the matter and allowed INX Media to make the investment.
The CBI and ED have argued that INX Media had not been given clearance by the FIPB to make 26 per cent downstream investment in INX News. But it went ahead in 2007 itself. When the matter was flagged by the I-T department and FIPB sought clarification from INX Media, it brought in Karti to sort out the issue. Karti, investigators claimed, helped INX Media seek fresh approval for an investment which had already been made.
The company is accused of bringing in foreign investments worth over Rs 300 crore through three Mauritius-based companies against approval of only Rs 4.6 crore.