Chennai:
Enforcement directorate on Monday issued a showcause notice to Devas Multimedia for allegedly contravening the provisions of Foreign Exchange Management act (FEMA).
The special director (southern region) Chennai told Express that the total alleged violation under FEMA is worth 1,217.76 crore.
The notice by Enforcement directorate comes in the wake of ED registering a money laundering case in connection with the Antrix-Devas spectrum deal worth Rs.1,000 crore, that is also being probed by Central Bureau of Investigation.
Enforcement Directorate investigated suspected contraventions of the the provisions of FEMA in the Foreign Direct Investment received by Devas Multimedia Pvt Ltd, Bangalore, from various overseas investors including CC Devas Mauritius LTD, Telecom Devas Mauritius Ltd, Deutsche Telkom Asia Pvt Ltd and Devas Employees Mauritius Pvt Ltd.
The official said that they have sought the reply of Devas Multimedia Pvt Ltd for the contravention. “Based on their reply we will go in for personal hearing after which adjudication will be passed,” he said.
“In case the alleged contravention is proved in the adjudication proceedings, the noticees are liable for penalty under FEMA, 1999, which may be imposed up to thrice the sum involved in such contravention,” the official said.
Talking about the contraventions, the Enforcement directorate source said that the share subscription agreements entered into by the Indian company contained clauses relating to settlement of disputes at courts other than India and applicability other than Indian laws on matters of dispute and thus the FDI recieved by Devas Multimedia were contrary to the conditions specified in the approval granted by Foreign Investment Promotion Board and thus contravening the provisions of FEMA. The extent of contravention is Rs 578.54 crore.
Similarly, Devas Multimedia assured the overseas investor an annual 8pc priority dividend on cumulative basis Such assured dividends are not nature of equity investment and is contrary to FDI provisions under FEMA. The investment received under this is Rs 571.72 crore.
The third contravention pertains to the company violating the RBI regulations. The extent of contravention is Rs 67.50 crore
Enforcement directorate on Monday issued a showcause notice to Devas Multimedia for allegedly contravening the provisions of Foreign Exchange Management act (FEMA).
The special director (southern region) Chennai told Express that the total alleged violation under FEMA is worth 1,217.76 crore.
The notice by Enforcement directorate comes in the wake of ED registering a money laundering case in connection with the Antrix-Devas spectrum deal worth Rs.1,000 crore, that is also being probed by Central Bureau of Investigation.
Enforcement Directorate investigated suspected contraventions of the the provisions of FEMA in the Foreign Direct Investment received by Devas Multimedia Pvt Ltd, Bangalore, from various overseas investors including CC Devas Mauritius LTD, Telecom Devas Mauritius Ltd, Deutsche Telkom Asia Pvt Ltd and Devas Employees Mauritius Pvt Ltd.
The official said that they have sought the reply of Devas Multimedia Pvt Ltd for the contravention. “Based on their reply we will go in for personal hearing after which adjudication will be passed,” he said.
“In case the alleged contravention is proved in the adjudication proceedings, the noticees are liable for penalty under FEMA, 1999, which may be imposed up to thrice the sum involved in such contravention,” the official said.
Talking about the contraventions, the Enforcement directorate source said that the share subscription agreements entered into by the Indian company contained clauses relating to settlement of disputes at courts other than India and applicability other than Indian laws on matters of dispute and thus the FDI recieved by Devas Multimedia were contrary to the conditions specified in the approval granted by Foreign Investment Promotion Board and thus contravening the provisions of FEMA. The extent of contravention is Rs 578.54 crore.
Similarly, Devas Multimedia assured the overseas investor an annual 8pc priority dividend on cumulative basis Such assured dividends are not nature of equity investment and is contrary to FDI provisions under FEMA. The investment received under this is Rs 571.72 crore.
The third contravention pertains to the company violating the RBI regulations. The extent of contravention is Rs 67.50 crore
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