Actor-entrepreneur Ajay Devgan, born Vishal Veeru Devgan, bought over the entire shareholding of a British Virgin Islands (BVI) company Marylebone Entertainment Limited in 2013, claiming it was done to acquire and exploit overseas rights of Hindi films.
Mossack Fonseca & Co (BVI) Ltd was the registered agent of Marylebone Entertainment Ltd at the time of incorporation. The original shareholder of the company, registered in the BVI on October 29, 2013, was Hassan N Sayani, an individual based in London. Sayani was issued 1,000 shares on October 31, 2013. Ajay Devgan bought over the entire shareholding from Sayani the same day. When contacted, Ajay Devgan told The Indian Express, “This company was set up with RBI guidelines for overseas direct investment route. Proper disclosures have been made by my family in the tax returns as required by law.”
Responding to a questionnaire, Devgan’s chartered accountant Anil Sekhri said Devgan holds “1,000 shares on behalf of M/s Nysa Yug Entertainment, a partnership firm between Mr Ajay Devgan and Mrs Kajol Devgan”.
“This company was floated by Nysa Yug Entertainment through the ODI route and all formalities with respect to the RBI were complied with. The shares held in Marylebone Entertainment Limited are reflected by M/s Nysa Yug Entertainment in its balance sheet as filed with the I-T Department,” Sekhri said in a written response.
Marylebone Entertainment is authorised to issue a maximum of 50,000 shares of no par value. The company is engaged in the business of acquisition, distribution and exploitation of the overseas rights of Hindi films.
Ajay Devgan consented to act as a director in the company on October 31, 2013. He, however, resigned as director with effect from December 15, 2014. Before resigning, in a written resolution, Devgan approved the appointment of EFG Trust Company Limited and EFG Nominees Limited as directors of Marylebone Entertainment.
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Devgan’s resignation as a director from Marylebone Entertainment and appointment of foreign entities as directors could also be prompted by the government’s plans to introduce new rules to determine the place of effective management (PoEM). PoEM is a new concept that was introduced in Budget 2015 to determine the residency of a company. It has, however, been deferred until 2017 to give India Inc some time to prepare structures based on their place of residency.
In the same written resolution by Ajay Devgan signed on December 15, 2014, it was also decided that EFG Secretaries Limited would be appointed company secretary and replace Ajay Devgan as the authorised signatory of Marylebone Entertainment.
The written resolution of Devgan, passed pursuant to the company’s Articles of Association, also changed the registered agent of the Marylebone Entertainment to Nerine Trust Company (BVI) Limited from Mossack Fonseca & Co (BVI) Ltd.