Companies & Sectors
NDTV says it received show notice from ED on FEMA violations; ED charges amount involved is Rs2030 crore
NDTV told BSE that Prannoy and Radhika Roy, KVL Narayan Rao and NDTV Studios have received show cause notice from ED on alleged contraversions of provisions of FEMA 
 
New Delhi Television Ltd (NDTV) said it has received a show cause notice from the Enforcement Directorate (ED) regarding alleged contraversions of provisions of Foreign Exchange Management Act, 1999 (FEMA).
 
In a regulatory filing, NDTV said, "...the company along with Dr Prannoy Roy, Executive Co-Chairperson, Mrs Radhika Roy, Executive Co-chairperson, Mr KVL Narayan Rao, Executive Vice Chairperson and NDTV Studios Ltd (erstwhile subsidiary of the Company since merged with the Company) have on 19 November 2015 received a show cause notice from the Directorate of Enforcement as to why adjudication proceedings should not be held for alleged contraventions of provisions of FEMA."
 
According to the ED, “investigation under FEMA in the matter of NDTV Ltd. has revealed financial transactions in FEMA contraventions by NDTV Ltd. by availing the facilities provided by RBI relating to Overseas Direct Investment (ODI) and Foreign Direct Investment (FDI) as under   
 
1. NDTV Ltd. through its step down subsidiary in UK, NDTV Networks Plc. (NNPLC) was permitted by FIPB to raise overseas funds through public offerings of equity shares and through AIM listing at London Stock Exchange and remit those funds in its group companies. But NNPLC raised funds by way of overseas loan , bonds and optionally convertible preference shares.  NDTV Ltd. has violated Regulation 5 (1) of FEM (Transfer or Issue of Security to Persons resident outside India) Regulations, 2000 issued under Section 6 (3) (b) of FEMA by not complying with the terms and conditions of FIPB approval.
 
2. NDTV Ltd. raised funds outside India to the tune of USD 170 Million through NNPLC and brought USD 163.78 Million (Rs. 725.56 crore approximately) in its group companies in India during the period March, 2007 to October, 2010.  RBI has pointed out that bringing funds in its group companies by NDTV Ltd. from NNPLC  is not a genuine and bonafide business activity and is a contravention of Regulation 6 (2)(ii) of the FEM (Transfer or Issue of any Foreign Security) Regulations, 2004 issued under Section 6 (3) (a) of FEMA. 
 
3. NDTV Ltd. in its group companies in India further received USD 83,909,977 and USD 21972 from its overseas subsidiaries namely NDTV Mauritius Media and NDTV Worldwide Mauritius Ltd. under the automatic route of RBI in the guise of FDI. RBI has pointed out that bringing funds in its group companies by NDTV Ltd. from its overseas subsidiaries is not a genuine and bonafide business activity and is a contravention of Regulation 6 (2)(ii) of the FEM (Transfer or Issue of any Foreign Security) Regulations, 2004.  
 
Thus, NDTV Ltd. received an amount of Rs. 1113.31 crore approximately in total in contravention of FEMA provisions.
 
4. NDTV Ltd. has issued Corporate Guarantees (CG) in favour of NNPLC to the tune of USD 84 Million relating to the arrangement of funds of USD 170 Million and loans taken by NNPLC which were not reported to RBI. RBI has pointed out that not seeking RBI approval and not reporting to RBI to issue a Corporate Guarantee is a contravention of Regulation 6(2)(vi) and Regulation 6(4) of the FEM (Transfer or Issue of any Foreign Security) Regulations, 2004.
 
5. NDTV Studios Ltd. (another group company of NDTV Ltd.) has deposited a sum of Rs. 200 crore with Bank of Baroda, Corporate Financial Branch, Parliament Street, New Delhi relating to USD 70 Million Loan by NNPLC. NDTV Studios Ltd. has contravened the provisions of Section 3 (d) of FEMA. 
 
6. NDTV Ltd. bought back the transferred shares of its group companies namely NDTV Labs Limited, NDTV Imagine Limited, NDTV Convergence Limited, NDTV Lifestyle Limited and NGEN Media Services Ltd. to the tune of Rs. 296.74 crore from NNPLC to its group companies namely NDTV Lifestyle Holdings Limited and NDTV Networks Limited.  RBI has pointed out that such transactions are in contravention of Regulation 6(2) (ii) of the FEM (Transfer or Issue of any Foreign Security) Regulations, 2004. Thus NDTV Ltd. has contravened this Regulation read with Regulation 10B of the FEM (Transfer or Issue of Security by a Person Resident outside India) Regulations, 2000, for the amount of Rs. 296.74 crore.
 
7. Thus in the Show Cause Notice issued, NDTV Ltd. has contravened the provisions of the above said provisions of  FEMA and Regulations issued thereunder, in which the amount involved is Rs. 2030.05 crore approx.
 
Further investigation under FEMA is being carried out.”
 
NDTV maintained in the filing that it “has been advised that the allegations of the contraventions of provisions of FEMA in the show cause notice are not legally tenable and the Company will reply to the same within due course of time.”

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Karnataka mining baron Janardhan Reddy arrested again
The Special Investigation Team (SIT) of the anti-graft watchdog Lokayukta (ombudsman) on Friday arrested Karnataka mining baron and former BJP minister Gali Janardhan Reddy for his alleged involvement in the illegal export of iron ore from Belekeri port on the state's west coast.
 
"Reddy was taken into custody under the Prevention of Corruption Act in the case of illegal export of iron ore that was also illegally mined in Bellary district between 2008-10," an SIT official told reporters here.
 
Reddy, 48, has been on bail since January in other illegal mining cases the CBI filed against him in Hyderabad and Bengaluru since 2011. He was interrogated at the state secretariat's annex building a day after his accomplice Madhu Kumar Verma was quizzed on Thursday.
 
The state government had directed the SIT to probe the illegal export of 50,000 tonnes of iron ore by mining firms under Reddy's patronage and his aides, including two lawmakers, transporters and a few middlemen.
 
After interrogation by SIT sleuths, Reddy was taken to a state-run hospital at Yelahanka in the northern suburb under escort for medical check-up.
 
"We will produce him (Reddy) in a local court later for judicial remand and further interrogation as part of the investigation into the multi-crore scam," the official said.
 
Reddy, a member of the state legislative council, secured bail from the Supreme Court on January 20 after languishing in Hyderabad and Bengaluru jails since his arrest on September 5, 2011, when the BJP was in power in this southern state.
 
Disclaimer:  Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
 

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20 Indians among 170 taken hostage in Mali hotel
There are 20 Indians in the five-star hotel in Mali's capital Bamako where gunmen on Friday took 170 people hostage, External Affairs Ministry spokesperson Vikas Swarup said.
 
"#MaliAttack: Acc'g to current info there are 20 Indians staying in the hotel. Our Amb is continuously in touch with them & monitor'g sitn," Swarup tweeted.
 
The Radisson Blu hotel chain said two armed men locked in 140 guests and 30 of its employees.
 
Disclaimer:  Information, facts or opinions expressed in this news article are presented as sourced from IANS and do not reflect views of Moneylife and hence Moneylife is not responsible or liable for the same. As a source and news provider, IANS is responsible for accuracy, completeness, suitability and validity of any information in this article.
 
 

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