IPL FEMA violation case: ED summons Shah Rukh Khan

shahrukh khan

MUMBAI: The Enforcement Directorate has summoned IPL team Kolkata Knight Riderspromoter Shah Rukh Khan in a case related to violation of Foreign Exchange Management Act (FEMA). Shah Rukh has been asked to appear on July 23 to explain his position.

In March, the ED had issued a show cause notice to KKR and team promoters, Shah Rukh Khan, his wife Gauri and actor Juhi Chawla for violating Foreign Exchange Management Act (Fema) rules.

The KKR team promoters allegedly sold their shares to a Mauritius-based company at lower prices in 2009. The ED investigation concluded that it caused Rs 73.6 crore foreign exchange loss to the government. On basis of this they issued notices to Khan and others in March to start the adjudication proceedings.

KKR representatives explained their position to the adjudication authority after which the special director decided to call Khan for his final explanation before deciding the amount of penalty.

According to the ED case, initially, Shah Rukh and Gauri’s company Red Chillies owned the entire shareholding of KKR. After the success of IPL, 50 lakh shares were issued to TSIIL and 40 lakh shares to Chawla. These shares were allotted at a par value of Rs 10, although the actual value of these shares was much higher.

Chawla subsequently sold her 40 lakh shares to her husband’s company TSIIL at the same rate. Thus, TSIIL got 90 lakh shares of KKR at Rs 10 a share whereas the actual cost of each share ranged between Rs 86 to Rs 99. The ED concluded that it caused Rs 73.6 crore foreign exchange loss to the government.

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