The INX Media Case


The INX Media case pertains to the alleged irregularities in the Foreign Investment Promotion Board (FIPB) clearance to the media group for receiving overseas funds. 

Congress leader and former Finance Minister, P. Chidambaram, was arrested by the CBI on Wednesday in connection with its probe into alleged charges of corruption in the INX Media Case. 

His application for protection from arrest failed to get a hearing in the Supreme Court on August 21, after already being rejected by the Delhi High Court on August 20.

Chidambaram’s lawyer, Advocate Kapil Sibal urged before the court: “Please give him [Mr. Chidambaram] the relief of protection from arrest. If he is arrested, this entire petition for anticipatory bail becomes infructuous.” 

Chidambaram is being probed by the investigating authorities for alleged irregularities in the Foreign Investment Promotion Board (FIPB) clearances to the media group for getting overseas funds amounting to around Rs. 305 crores. This is when he was the finance minister in the UPA-I government.

The Central Bureau of Investigation (CBI) had registered an FIR on May 15, 2017, alleging irregularities in the FIPB clearance given to INX Media for receiving funds from abroad to the tune of Rs. 305 crores in 2007. This was when P. Chidambaram, father of Karti Chidambaram, was finance minister. 

Indrani Mukherjea, and her husband Peter Mukherjea, who co-founded INX Media in 2007 had been charged with entering into a criminal conspiracy with Karti Chidambaram to get foreign investments and evade getting necessary approvals from the Foreign Investment Promotion Board (FIPB).

ED also filed a money laundering case in the matter of 2018. INX Media was then owned by Indrani and Peter Mukherjea, currently in jail in connection with the Sheena Bora murder case. In February 2018, Karti Chidambaram was arrested for allegedly accepting money for clearance of the media group. He was later granted bail. Meanwhile, his father moved the Delhi High Court seeking anticipatory bail in the CBI and ED cases. On Jan 25, 2019, the court reserved its judgment on the pleas. On August 20, the High Court dismissed the petitions and Chidambaram was arrested on the night of August 21.

What is the case?

In March 2007, INX Media was granted permission by the FIPB for issuing shares to three Mauritius companies, amounting to Rs. 4.62 crore, into INX Media through the FDI route. However, INX Media’s proposal for downstream investment was rejected. 

This was, however, not the case. According to the CBI, INX Media brought in a much larger sum of Rs. 305 crores instead of the approved Rs. 4.62 crore FDI. It even went a step further when it brought in downstream investment, clearly against the approval and in violation of the rules. According to the CBI and the ED, Karti Chidambaram used his influence with officials in the finance ministry and the FIPB to cover-up the illegal foreign transactions and violations of the rules made by INX Media.

Acting on a complaint, the Income Tax department sought clarifications from FIPB, prompting the latter to seek explanations from INX Media, which then hired Karti Chidambaram to resolve the matter.

According to the CBI, the company entered into a criminal conspiracy with Karti to get “issues resolved amicably by influencing public servants of FIPB”, with the help of his “relationship with the then finance minister.” CBI said that INX Media was advised to apply for a fresh FIPB approval for the downstream investment that had already been made by the company and which was now accepted.

While investigating a company associated with Karti Chidambaram, ED found documents linked to INX Media in the computer of Karti’s CA Bhaskarraman. These documents indicated payments made to Karti’s alleged company by INX Media at the time the Finance Ministry granted it FIPB approval.

According to the investigating agencies, money was transferred to companies with links to Karti, such as Advantage Strategic Consulting, which received Rs. 10 Lakh payment from INX Media, along with other funds from various sources.

In this regard, on May 2017, CBI registered a case of corruption. Following this, ED lodged an Enforcement Case Information Report (ECIR) – a police FIR equivalent – a case of money laundering against Karti.

In March 2018, Indrani Mukherjea told the CBI, under a statement recorded under Section 164 of the Code of Criminal Procedure, that a deal of $1 million was struck between Karti Chidambaram and the Mukherjeas to secure approval from the FIPB. Last month, the Delhi High Court had allowed Indrani Mukerjea, who is a prime accused in the murder of her daughter Sheena Bora, to turn approver in the INX case. In her application to turn approver, Mukherjea prayed for pardon in the case in exchange of full and true disclosure.

Indrani told the ED that she and her husband Peter had met Chidambaram in 2008 when he was the finance minister. Indrani said that Chidambaram allegedly told Peter to help his son Karti in his businesses and make possible overseas remittances in return for the FIPB approval. Indrani also met Karti who asked for $1 million to be transferred into an overseas account to sort the matter. 

According to the ED, Karti has made several overseas purchases, including a tennis club in Spain, cottages in the UK, and several other properties in India and abroad worth over Rs. 54 crores. All these properties were allegedly bought through the bribes received by Karti in the INX Media case.

On August 21, 2019, Chidambaram was arrested in the CBI case and was sent to a four-day custody with the CBI, which was extended till the 5th of September.

During the proceedings at the trial court, the CBI told the court that Chidambaram can be sent to judicial custody as he was a powerful public person and should not be set free.

September: On Thursday, September 5, 2019, the special CBI Court sent the former finance minister to Delhi’s Tihar Jail for 14 days till September 19 in connection with the case. The verdict was pronounced by Special CBI Judge Ajay Kumar Kuhar. “The allegations against the accused were found serious therefore he was remanded to police custody. The investigation is still in progress,”… “Having considered all facts and circumstances of the case, the nature of offences, stage of the investigation, the accused is remanded to judicial custody,” said Special Judge Kuhar.

The court allowed him to carry his spectacles, prescribed medicines and provided him with a western toilet facility. It also directed that he be kept in a separate cell in Tihar prison as he was a protectee under Z-security.

The Supreme Court refused to grant protection to Congress leader P Chidambaram over corruption allegations in the INX Media case, saying that the investigating agency, Enforcement Directorate, has to be given sufficient freedom to conduct its probe, and the grant of anticipatory bail at this stage would hamper the investigation. P. Chidambaram now faces arrest by the Enforcement Directorate.


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