The Enforcement Directorate (ED) is probing a case of alleged foreign exchange violation by INX Media Pvt Ltd (now called 9X Media Pvt Ltd), according to ED officials.
The case registered under Foreign Exchange Management Act (Fema) by ED in 2010 pertains to investment by three Mauritius-based companies in INX Media.
According to officials, INX Media had secured approval from the Foreign Investment Promotion Board (FIPB) for foreign direct investment up to 46 per cent in the company. The foreign entities bought shares of INX at Rs 862.31 a piece, which was 86.2 times more that the face value of the shares. The ED investigation has alleged that the FDI received by INX Media was invested in stepdown subsidiaries of the media firm without prior approval of the FIPB.
“We are still investigating the case. So far, no showcause notice has been issued by the department,” said an ED official who did not want to be named.
A company spokesperson for 9X Media said, “The company has been in compliance with applicable laws.” In 2007, Peter Mukerjea and Indrani Mukerjea raised about $220 million from private equity firms Temasek Holdings, New Silk Route Advisors, Kotak SEAF India Fund, New Vernon Private Equity and SREI Group to start INX Media with a music channel 9XM and a Hindi general entertainment channel (GEC), according to a 2009 media and entertainment report by law firm, Nishith Desai Associates.
In 2008, the media firm launched NewsX, an English news channel. Within a year of launch, the news channel was sold to Indi Media Network, a joint venture between Nai Duniya owner Vinay Chhajlani and Jehangir Pocha. In March 2009, Peter and Indrani exited the company after selling their 30% stake in loss making INX Media. In April 2010, the Hindi GEC of the company was sold to Zee Network for Rs 64 crore. The same year, INX Media was renamed as 9X Media. Subsequently, in 2011, New Silk Route increased its stake in the company to 80% by buying out all the other private equity investors in the company.
In response to queries from The Indian Express, Peter Mukerjea said he left the company in March 2009. Indrani Mukerjea is in police custody after she was arrested on August 25. Police claim that they have specific leads linking her to the murder and disposal of the body of her daughter Sheena Bora.