In the long running saga that is the INX Media case, the most high-profile person involved and in custody, former Finance Minister P Chidambaram, on Wednesday, was granted bail by the Supreme Court in a CBI corruption case; though he will remain in jail. The court stated that there is no evidence of him attempting to influence any witnesses as was alleged.
Last week, the CBI presented its chargesheet against Chidambaram, nearly two months after his arrest in the INX media case. Among those named in the chargesheet are former associates of the finance minister, Peter Mukerjea and the former finance minister’s son Karti. Indrani Mukerjea, on of the directors of INX media, turned promoter, has told investigators about meetings between her and Chidambaram and payments made through off shore accounts and bribes being sought. Shastri Ramachandran, independent political and foreign affairs commentator, in a column
for Outlook, writes on why the CBI chargesheet isn’t up to the mark –
“It trivialises the case and raises questions about the credibility of the accusations. In public perception, such a chargesheet does more damage to the CBI than the accused. However, now there would be greater interest in seeing how the judiciary deals with this
INX Media origins
INX Media was founded in 2007 by Indrani Mukerjea and her husband Peter who was at the time, CEO of Star India. They had recruited several top media executives including noted journalist Vir Sanghvi into the company. Their aim was to launch a slew of channels catering to news and entertainment. A decade later, both are in custody for the alleged murder of Indrani’s daughter Sheena Bora and the company is at the heart of a high-profile corruption case.
Almost two years after its launch, the company ran into some financial trouble in terms of funding. The goal of the company was to have a Hindi entertainment channel, an English news channel; to operate under a subsidiary INX News Pvt Ltd and regional entertainment and music channels to operate under INX Media Pvt Ltd. In 2009, Indrani and Peter stepped down from their management positions after the company accumulated losses of Rs. 800 crores. INX News was sold as well as their Hindi General Entertainment channels.
Vir Sanghvi was hired as CEO and editorial head for their news channel, but things didn’t go as planned. He quit a few months before its launch citing disagreements over allocation of funds towards the news division. He said in part, “I had disagreements with the promoters over the channel and I quit, and soon after me, about 80 employees hired for the news channel quit the channel”.
Corruption scandal and the Chidambarams
In 2008, the Financial Intelligence Unit (FIU-IND) of the Finance Ministry, caught wind of FDI of over Rs. 305 crores made by three Mauritius based companies to INX media. The media group had a case registered against them by the ED in 2010 for Foreign Exchange Management Act (FEMA) violations.
On May 15, 2017, the CBI had registered a FIR over alleged irregularities in the Foreign Investment Promotion Board (FIPB) clearance to the INX Media Group. This pertained to the company being given the green light by the FIPB to receive overseas funds amounting to Rs. 307 crores when P Chidambaram was the Union Finance Minister. In 2018, Enforcement Directorate (ED) lodged a case as well. Shortly after the CBI filed their FIR, The Foreigner Regional Registration Officer (FRRO) and Bureau of Immigration issued Look Out Circulars for Karti; this was stayed by the Madras High Court.
The CBI itself has come under scrutiny and criticism for being used a tool of political vendetta by going after political opponents. In August of this year, Chidambaram was arrested by the CBI after absconding for a couple of days. Both he and his son have denied any wrong doing and claimed that the ruling BJP is using the CBI as a political tool in their efforts to root out corruption. The Livemint editorial stated that the circumstances of his arrest at the time, should be cause for concern –
“Whatever the outcome, what has come to concern observers schooled in law is the weight of force being used in this case. No matter how scandalous people may think a politician’s conduct is, the rule of law must prevail. So too for everybody, famous or not
The CBI, in investigating Karti’s CA Bhaskarraman, found documents linked to INX media. The company is alleged to have enlisted Karti’s firm, Chess Management Service in 2008, to resolve the issue after the IT department began its investigation. They wanted Karti and his firm to lobby and ‘influence officials in the FIPB’ within the Finance Ministry, at a time when his father was the Finance Minister. The CBI alleged that the FIPB did not investigate the case and instead asked the firm to apply for a fresh approval for investments it had already received.
As the case continues to proceed, it will likely take some time for the full picture to reveal itself. This sort of scandal isn’t new for Indian politics and business mixing. The 2G scam which saw former Telecom Minister A Raja spend time in prison is a good example. That too involved the previous government; a talking point used effectively by the BJP in claiming electoral victory in 2014.
That talking point of rooting out corruption, has come up a number of times over the past few years. With the likes of Vijay Mallya, Nirav Modi and others absconding and taking refuge overseas. Someone as high profile as P Chidambaram being arrested could be a turning point, as Makarand Paranjape, Professor and Director at the Indian Institute of Advanced Study, writes in a column
for The Print –
“Is Chidambaram’s arrest a turning point in Indian politics? Most certainly, yes. It is not just the optics or sonics, but the deeper ramifications of these events that should concern us. A loud and clear message has been sent out that the Modi-Shah duo will not only fight to the finish, but go for the jugular
More columns by Varun Sukumar