ED will file prosecution against Chidambaram

Maitri Porecha New Delhi | Updated on August 21, 2019 Published on August 21, 2019

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But only after custodial interrogation of the ex-finance minister, say sources

The Enforcement Directorate (ED) is jointly investigating all cases linked to former finance minister P Chidambaram and his son Karti Chidambaram’s business transactions including the INX Media case.

Sources in the ED said that they are ready to file a prosecution against Chidambaram, but they will do so only after his custodial interrogation.

The Central Bureau of Investigation (CBI) on Tuesday night issued summons to Chidambaram. CBI officials also posted a notice seeking his appearance within two hours before the investigating agency in connection with the INX Media case.

It is alleged that Chidambaram received kickbacks for giving foreign investment approvals to INX Media amongst various other companies. The kickbacks were routed through companies associated with his son Karti. In the process of nailing the links, the ED analysed the Foreign Investment Promotion Board (FIPB) approvals granted by Chidambaram to INX Media, Aircel-Maxis, Diageo Scotland, Katara Holdings, Essar Steel and Elforge.

Transfer of ownership

“During the time that these approvals occurred, in the UPA-I tenure, we also analysed the companies floated by Karti, the ownership of which was later transferred to his friends, chartered accountant, and so on. For example, one of these companies – Advantage Strategic Private Ltd received about ₹1.5 crore from the same companies that had received FIPB approvals from Chidambaram,” said a senior ED official.

While Karti was initially the promoter of Advantage Strategic, he later transferred the ownership to his friends, who confessed making a will relinquishing the shares of the said company to Karti’s daughter. “The shareholders and directors of a main shell company have made a will of transferring entire shareholding of the shell company to the grand-daughter of Chidambaram and executor of the will is Karti,” alleged another official.

Also read: INX media case: Chidambaram fails to get urgent audience in SC against Delhi HC order

The ED will turn in the proofs to the court, and officials claim that those who owned these companies have confessed to making such wills.

Latest ED investigations have found that Karti allegedly incorporated several shell companies both in and outside India, where kickbacks were allegedly received, and in one shell company deposits of over ₹300 crore have been made. According to the official several immovable properties in Malaysia, UK, and Spain were purchased by Karti’s friends, who have no substantial income of their own.

Incriminating evidence, including the wills, were seized by the Income Tax Department, the ED and the CBI while raiding residences of Karti and Chidambaram in Chennai and Delhi. On Tuesday, the investigating agencies went to his Jor Bagh residence to take him under custody.

Custodial interrogation

“They refused to cooperate during interrogation, so we are well within our powers to seek a 15-day custodial interrogation under Section 19 of the Criminal Procedure Code. Chidambaram can move for relief at the end of the 15 days, after which CBI may want to seek his custody for interrogation too,” said the official.

Read: Enforcement Directorate issues look-out notice against P Chidambaram

CBI officials said that Chidambaram did not appear after the summons was issued on Tuesday to him. “We have not issued any more summons after the two-hour notice. He has been summoned once before in connection with the INX Media case when he appeared before the CBI,” the official added.

Chidambaram has approached the Supreme Court seeking anticipatory bail to avoid being detained or being sent for custodial interrogation. The apex court on Tuesday deferred hearing on his bail plea till Friday. This gives investigating agencies two days to bring him in for custodial interrogation.

With inputs from Delhi Bureau

Published on August 21, 2019
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