From The Times of India

NEW DELHI: A day after protests against CBI raids on NDTV co-founders and executive co-chairpersons Prannoy and Radhika Roy, government officials said the probe by the agency was an “offshoot” of investigations by the tax department and the Enforcement Directorate which have been going on since 2011 when the UPA was in office.

A senior government functionary, detailing the routing of funds by NDTV through so-called shell companies in India and abroad, said the I-T department has been looking into the alleged undisclosed income of Rs 1,600 crore of the Roys and the companies controlled by or associated with the NDTV group.

Based on the CBI FIR, the ED is also considering initiating a money laundering probe.

CBI has handed over its FIR to ED, which is being examined. There are accusations of a financial gain of Rs 48 crore to promoters of NDTV and suspicious use of shell companies in routing the money, which the broadcast company has denied. CBI had lodged an FIR against the Roys, RRPR Holdings and unknown officials of ICICI Bank.

On the I-T and ED investigations against NDTV since 2011, senior government officials, who didn’t wish to be named but cited the allegations on the basis of documents, said that NDTV, controlled by Roys, had only two subsidiaries in India till 2006. However, from 2006 to 2012, it floated 32 “paper companies”, including 14 foreign shell companies in UK, the Netherlands, Mauritius, Sweden and UAE.

The officials alleged that this was done with the intention to launder unaccounted income of Rs 1,100 crore using these entities. The sources accused these companies of having “no real business, no employees and no business premises”.

Allegedly, 14 shell companies (except the one at Mauritius) were intentionally dissolved after laundering the funds so that it becomes difficult for the tax and enforcement authorities in India to lay hands on them.

Officials further alleged that the paper companies have claimed to have raised funds through unidentified entities situated in British Virgin Islands, Cayman Islands, UK, US, Switzerland and the Netherlands during financial years 2007-2009. The IT department had already found that these claims were “false”, they said.

Further assessment by I-T department of the concealed income of Rs 642.5 crore relating to the group and related companies was done during UPA regime on February 21, 2014, an officer said. Then, re-assessment proceedings for concealment of income of Rs 403.85 crore was initiated against RRPR Holdings Pvt Ltd (owned by the Roys), which is currently under way. Subsequently, assessment proceedings of allegedly unexplained funds of Rs 400 crore, received from unknown entities in British Virgin Islands and Cayman Islands, is also being carried out by the department, an officer said.

Government officials alleged that concealed income of Rs 94 crore and Rs 47 crore by Radhika Roy and Prannoy Roy, respectively – purportedly through manipulation of sale and purchase prices of shares – has been assessed and has been confirmed in the first appeal with the tax department. The officer claimed that RBI has also detected violation of several provisions of FEMA by the NDTV group, which add up to over Rs 2,000 crore.

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