TheIndian EXPRESS LATE CITY, 22 PAGES, MUMBAI, `5.00 ● THURSDAY, JUNE 21, 2018 ● WWW.INDIANEXPRESS.COM ● REG.NO. MCS/067/2018 - 20 RNI REGN. NO. 1543/57 DAILY FROM: AHMEDABAD, CHANDIGARH, DELHI, JAIPUR, KOLKATA, LUCKNOW, MUMBAI, NAGPUR, PUNE, VADODARA TRANSACTION UNDER SCRUTINY More conflict of interest? Mumbai house of Kochhars has Videocon connection Income Tax probes acquisition of CCI Chambers apartment in Mumbai by husband of ICICI Bank’s Chanda Kochhar KHUSHBOO NARAYAN MUMBAI, JUNE 20 THE INCOME Tax department is probing the acquisition of the current family residence of Chanda Kochhar, the CEO and MD of ICICI Bank, in South MumbaibyherhusbandDeepak Kochhar in a complex transaction involving firms linked to Videocon Group, sources have told The Indian Express. The link between Videocon andtheresidenceoftheKochhars reinforces questions of propriety and conflict of interest that have dogged Chanda Kochhar and are nowthesubjectofan“independent” probe announced by the ICICI Bank. On Monday, the bank said she will be on leave until the probe is completed. The tax department, sources said, is now probing the transaction involving the acquisition of the flat at 45, CCI Chambers CHS Limited — it is in the Churchgate area opposite the Cricket Club of India — and has informed the Central Board of Direct Taxes (CBDT) about its findings so far. On March 29, The Indian Express first reported that Videocon promoter Venugopal Dhoot provided crores of rupees to NuPower Renewables Pvt Ltd (NRPL),afirmhehadsetupwith Chanda Kochhar’s husband and tworelativessixmonthsafterthe The CCI Chambers in South Mumbai: This is where the Kochhar family lives. Santosh Parab TANGLE OF TRANSACTIONS ICICIBank-Videocon-DeepakKochhar businessgroupgotRs3,250crore as loan from ICICI Bank in 2012. Dhoottransferredproprietorship of the company to a trust owned byDeepakKochharforRs9lakh, six months after he received the loan from ICICI Bank. The Videocon account was declared an NPA or a bad loan in 2017. THEEDITORIAL PAGE Tax authorities have found that the Kochhar family’s residence since 1998 was bought through Credential Finance Ltd, afinancialservicesfirmsetupby Deepak Kochhar and his brother Rajiv Kochhar in the mid-1990s, sources said. Due to financial stress, the company filed for liquidation and was suspended from trading in 1996-97. Seven members of the Kochhar family and Videocon International had a stake of 2 per cent and 17.74 per cent, respectively, in Credential Finance as on 2001. In 2009, Videocon Industries Ltd (VIL) nominated Quality Appliances Pvt Ltd, a firm with CONTINUEDONPAGE2 A betrayal in the Valley BY FIRDOUS TAK Batch Starts 3 July By: Ranjan Kolambe & Bhagirath Team PUNE 8087 833 999 7378 406 920 8087 922 999 9970 298 197 IIMs object to fee clause in draft rules RITIKA CHOPRA NEW DELHI, JUNE 20 THE INDIAN Institutes of Management (IIMs) have expressed concern to the government about a provision in the draftrulesunderthenewIIMAct that seeks to put a condition on the tuition fee charged by the 20 elite business schools. The HRD Ministry shared a copy of the draft rules with the IIM chairpersons for their feedback last week. The Indian Express has learnt that some of the older institutes have objected to the clause that mandates the Board of Governors (BoG) to “ensure that the fee charged from the students shall be commensurate with the overall expenditure for maintenance and expansion of the institute”. According to sources in the IIM community, the older institutes are more uncomfortable CONTINUEDONPAGE2 PANAMA PAPERS THE AFTERMATH AN INVESTIGATION BY THE INDIAN EXPRESS WITH INTERNATIONAL CONSORTIUM OF INVESTIGATIVE JOURNALISTS & SUDDEUTSCHE ZEITUNG, MUNICH Fresh Panama Papers reveal new names, confirm client trails, panic Mossack Fonseca managed three offshore firms for PVR’s Bijlis Over 12,000 new records investigated by The Indian Express give teeth to regulatory agencies probing trails of Indians, their firms in secret tax havens UPSC 10 Prelim + Mains + Interview JOURNALISM OF COURAGE Subramanian’s term was to end May 2019. Prem Nath Pandey CEA stepping down, says reasons personal ENS ECONOMIC BUREAU NEW DELHI, JUNE 20 ANNOUNCING HE would be stepping down as Chief Economic Adviser, Arvind Subramanian Wednesday said he would be leaving the Finance Ministrysoonthoughhehadnot yet finalised the date of his last day in office. The departure announcement comes eleven months before the end of his term in May 2019. Subramaniancited“personal reasons” along with the expected arrival of his grandchild early-September as reasons to return to a life of research, writing, teaching and reflection. Hesaidthesearchforhissuc- BUSINESS AS USUAL BY UNNY cessor will begin in next few daysandthegovernmentshould focus on competence, than CONTINUEDONPAGE2 RITU SARIN & JAY MAZOOMDAAR NEW DELHI, JUNE 20 TWO YEARS after they blew the lid off how the global elite, including over 500 Indians, park and move their money in and out of secret tax havens, the Panama Papers are back — to reveal telling new details. More than 1.2 million fresh documents, at least 12,000 of them linked to Indians, have been investigated by The Indian Express,incollaborationwiththe International Consortium of Investigative Journalists and GermannewspaperSuddeutsche Zeitung. Just as was done with theearliersetof over11.5million documents in 2016. This fresh investigation of Indian individuals and entities who figure in this new set of papersrevealshowPanamanian law firm Mossack Fonseca, which serviced their accounts, scrambled to respond to an unprecedented global crackdown. Significantly, confirming, in the process, the existence of several customers who had hitherto deniedanylinks.Andliftingtheveil on the financial trail of new clients. Clearly, this new set — Panama Papers: The Aftermath — which The Indian Express has investigated, in the first set of a series of reports that begins today, will provide further teeth to the inquiries and audits ordered WHAT’S NEW JAY MAZOOMDAAR NEW DELHI, JUNE 20 SIZE OF NEW LEAK 443GB NO. OF NEW FILES 1.2million IMPACT OF 2016 EXPOSE No. of global inquiries 150 No. of clients under probe in India 426 No. of searches and seizures in India 58 No. of prosecutions filed in Indian courts 16 Undisclosed income detected so far in India Rs1,088crore bythegovernmentanditsinvestigative agencies. This second lot of the PanamaPapershighlightsdetails of offshore companies incorporated by a clutch of Indian businessmen who did not figure in the2016leak.TheseincludeAjay CONTINUEDONPAGE2 TOMORROW: INDIANS DOMINATE INQUIRY LISTS The building that housed law firm Mossack Fonseca in Panama City. Its secret world was uncovered in 2016. File Among new names, telecom czar’s son, a business couple RITU SARIN NEW DELHI, JUNE 20 THREE WEEKS before the Panama Papers were published in April 2016, internal email exchanges in Panamanian law firm Mossack Fonseca revealed names of UBOs (ultimate beneficialowners)of somepreviously registered companies, new records show. Among them is KBM Global Limited,acompanyregisteredin theBritishVirginIslands(BVI)by Mossack Fonseca in December 2008. Email exchanges between March 16 and March 17, 2016, show that the BO (beneficial owner) of the company is Kavin Bharti Mittal, founder and CEO of Hike Messenger and son of telecom czar Sunil Bharti Mittal. His Amrita Shergill Marg, New Bank of Maharashtra’s top officials held in DSK fraud case EXPRESS NEWS SERVICE PUNE, JUNE 20 THE ECONOMIC Offences Wing (EOW) of the Pune city police on Wednesdayarrestedtopofficials of the Bank of Maharashtra, including its CEO and managing director Ravindra Prabhakar Marathe, in connection with the Rs2,043-crorefraudcaseagainst Pune-based DSK group accused of cheating thousands of its depositors. Along with Marathe, police also picked up bank’s executive director Rajendra Kumar Vedprakash Gupta, former CEO and MD Sushil Muhnot and zonal manager Nityanand Sadashiv Deshpande on charges of conspiring with the key accused to illegally sanction a loan of Rs 100 crore for a real estate project of a DSK group company. Police have claimed that the accused bank officials had violatednormsandReserveBankof India (RBI) guidelines while sanctioning the loan. Two officials of the D S Kulkarni Developers Limited (DSKDL), chartered accountant Sunil Madhukar Ghatpande and chief engineer and vice-presidentRajivDullabhDasNevaskar, were also arrested. While Muhnot was arrested from Ahmedabad, Deshpande was taken into custody from Jaipur. Both were being brought to Pune. The other four were arrested from Pune and produced before the Shivajinagar special court, which remanded them to police custody till June 27. In a statement, the Bank of Maharashtra, however, maintained that the loans were sanctioned to the firm “as per the bank’s lending norms”. “Thebank’stotaloutstanding exposure to M/S D S Kulkarni DevelopersLimitedistothetune of Rs 94.52 crore, which is fully secured by primary and collateral securities. Recovery process like SARFAESI action has already been initiated by the bank and some of the properties are due for auction. Bank has also declared M/S DSK Developers Limitedanditspromotersaswilful defaulters,” the statement said. The promoters of the DSK group, D S Kulkarni and his wife Hemanti, are already in police custody. So are five other officebearers of the group. Kulkarni’s son, Shirish Kulkarni, and some other family members are also accused in the case. While seeking custody of the bank officials, the Pune police told a local court that these officials had sanctioned the loan to the DSK group company without the approval of other banks, which were part of a consortium. The consortium included the State Bank of India, United Bank of India, Syndicate Bank, Vijaya Bank and IDBI Bank. Also, the loan amount was supposed to be disbursed in instalments according to the progress in CONTINUEDONPAGE2 Delhi address is mentioned in the email exchanges where the name of the BO has been inserted. While KBM Global Limited figures in the International Consortium of Investigative Journalists’s’database as a Mossack Fonseca company listed in the Panama Papers, there is no “officer” named. The only details available until April 2016 (when the Panama Papers were published) is that the Secretary or the intermediary of the company was Minerva Trust Company Limited and its shareholder was Minerva Nominees Limited, holding 94 shares. A second company, Anten Resources Incorporated, was shownasanothershareholderof KBM Global Limited. In the new records, there are CONTINUEDONPAGE2 AROUND THE time the Panama Papers uncovered the secret world of Mossack Fonseca, offshorecompanieslinkedtothe Bijli family of PVR Cinema fame continued to do business with the Panamanian law firm. A pioneer in multiplex cinemas in India, Ajay Bijli, along withwifeSelenaandsonAamer, beneficially owned an offshore company set up to hold a property in the UK. In April 2016, according to the latest cache of Mossack Fonseca’s internal documents, the Bijli family also held two other offshore companies through a Trust and Delhi-based Priya Exhibitors Private Limited. Chesterfield Mayfair Holdings Limited was set up in the British Virgin Islands (BVI) in May 2005. Mossack Fonseca became the company’s registered agent in 2012. In April 2016, two BVI companies — Tainstar Limited and Cinestar Limited — held between them all the shares of Chesterfield Mayfair Holdings Limited. Both Tainstar Limited and Cinestar Limited were CONTINUEDONPAGE2 FULL COVERAGE PAGES 13, 14 New Development Plan of Mumbai set to be put on hold for two months SANDEEP ASHAR MUMBAI, JUNE 20 A GROWING list of errors in Mumbai’s newly sanctioned development plan (DP) has allegedly forced the Maharashtra government to keep it in abeyanceforatleastanothertwo months. Whilethenewblueprintwas to come into effect from June 22, sources said that Chief Minister Devendra Fadnavis-led urban development (UD) department will issue a notification in the next couple of days regarding the delayed implementation. The much-awaited DP had received the chief minister’s sanction on April 25 and was published in the official gazette onMay23.Ithadmentionedthat thenewDPwillbeimplemented afteronemonthasperprovisions of the Maharashtra Regional Town Planning Act, 1966. But several discrepancies have been noticed in the newly sanctionedplan.Acknowledging that several corrections were needed, the government has now bought more time before bringingitinforce.Withthenew DPinabeyance,sourcessaidregulations governing the existing development plan will continue to be in force. The new DP had lowered permissible floor space index (FSI) for construction in the suburbs of Mumbai as compared to existing levels, sparking fears that construction activity would come to a halt in the region. Though the government has already declared its intention to restore this back to the previous level, the proposal is part of the ‘Excluded Part (EP)’ of the new plan, on which public suggestions and objections have been sought and a final sanction is yet to be accorded. CONTINUEDONPAGE2 ● PAGE ONE ANCHOR RUSSIA WORLD CUP SPARKS NEW DEBATE: IS VAR GOOD OR BAD? VAR has come as great help to referees but players are not impressed CHRISTOPHER CLAREY KAZAN (RUSSIA), JUNE 20 IF FOOTBALL officials thought thatintroducing theuse of video to help referees in this World Cup would stop the disputes, they were mistaken. Take a few of the headlines from Sunday, the day after France defeated Australia, 2-1, with help from a penalty kick awarded after video review: “‘I GottheBall’:Risdonslamscostly VAR penalty,” shouted the Sydney Morning Herald. “Mat Ryan feels Australia were hard done by,” said The Guardian. Clearly, even after the small fortune invested in technology andtraining,thevideo-assistantreferee system, known as V.A.R., is no panacea. Ontheclublevel,thePremier League, the world’s most prestigious domestic football competition, and UEFA, which runs the Champions League, the most prestigious international club competition, are still not ready to commit to V.A.R. But that does not mean FIFA, the sport’s often untrustworthy governing body, is on the wrong path. There will be bumps, maybe even an occasional accident,buttheuseof replayincritical situations, which is what V.A.R. is to be limited to, is still the best chance to make the World Cup and the sport a fairer proposition. There have been too many blunders, too much lost trust, throughthedecadestothinkotherwise.DiegoMaradona’s“Hand of God” goal against England in the 1986 World Cup might have quite a ring to it, but it was also a travesty and a blown call. France was belatedly awarded a penalty kick on Saturday after this foul by Joshua Risdon of Australia. AP Even Maradona now agrees thattryingtoavoidarepeatisthe right move, and it is all the more necessary in a media landscape where every fan with access to a screen is able to watch replay afterreplayofpivotalmomentsand decisions.Thereferees,untilnow, have been stuck with real time and the blur of the moment and having to judge the actions of players who have been training their whole lives, in some cases, to be world-class thespians. ” e’re just starting out, but W we are convinced that eventually video will be beneficial to football because behavior will change,” Pascal Garibian, France’snationaltechnicaldirector for referees, said in an interview this month with France Football. There is already some evidence. Germany’s Bundesliga has been among the early adopters, and each week they work out a few more kinks. Italy’sSerieAusedV.A.R.lastseason for the first time. According to the league, which compared data with the previous season, refereeerrorsdroppedfrom5.78 percent of decisions to less than 1 percent. Expulsions were down 7.1 percent. And on a particularly encouraging note, simulation, also known as diving, was down 35.3 percent. Meanwhile, the amount of time when the ball was actually inplayduringa90-minutegame increased by an average of 43 seconds to just over 51 minutes. Fewer argumentsover decisions mean fewer long discussions. Suchnumber-crunchingnaturally will be done during this World Cup, as well, and with good reason. Concern about maintaining football’s flow has long been one of the big argumentsagainsttheuseof anysystem with the power to pause play. Many other sports that have successfully introduced CONTINUED ON PAGE 2
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