NDTV probe is about wrongful gains, not loan default: CBI
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NDTV probe is about wrongful gains, not loan default: CBI

The CBI searched the offices and homes of NDTV founder Prannoy Roy over allegations of defrauding a bank, a move the news broadcaster denounced as a “witch-hunt”.

india Updated: Jun 06, 2017 17:59 IST
HT Correspondent
HT Correspondent
New Delhi, Hindustan Times
Central Bureau of Investigation officials conduct raids on the residence of NDTV founder Prannoy Roy. (PTI)

The Central Bureau of Investigation (CBI) said on Tuesday it didn’t search NDTV’s registered office or any premises associated with the private TV channel’s media operations, stressing that the agency respects freedom of press.

“It is clarified that searches have been carried out on the premises of the promoters and their offices based on search warrants issued by the competent court,” the CBI said, adding that it “is committed to the free functioning of news operations”.

The statement came after the agency searched on Monday the offices and homes of NDTV founder Prannoy Roy over allegations of defrauding a bank. The private news broadcaster denounced the move as a “witch-hunt” to stifle free speech.

CBI agents named Roy, his wife Radhika and a private company linked to NDTV — RRPR Holding Private Ltd — among others in a criminal case for allegedly causing a loss of Rs 48 crore to ICICI Bank.

The raids come at a time when the Opposition has accused the government of selectively targeting charities and media groups as part of a campaign to control free speech and dissent.

Opposition parties condemned the CBI raids, and the Editors Guild of India expressed “deep concern” over the move.

The CBI clarified that “…the case (is) based on the complaint of a share holder of ICICI bank and NDTV after carrying out due diligence”.

The private bank didn’t respond when contacted for comments.

The CBI said “wrongly accusing” the agency of acting under pressure is “uncalled for and an attempt to malign the image of the CBI”.

In 2008, ICICI Bank gave the private holding company a loan of Rs 366 crore on personal guarantees of the Roys, who pledged their NDTV shares that were valued more than the prevailing price at the Bombay Stock Exchange.

Within a year, ICICI settled for foreclosure of the loan, agreeing to a part-waiver of interest that allegedly resulted in a loss of Rs 48 crore for the bank, the CBI’s formal investigations launched last week said. The Roys moved out an equivalent amount from RRPR’s bank account, it alleged.

“The allegations under investigation are not regarding the default in loan repayment, but relate to the wrongful gain of Rs 48 crore to the promoters: Prannoy Roy, Radhika Roy, RRPR Holdings Pvt Ltd.”

“And a corresponding wrongful loss to the ICICI bank arising from their collusion and criminal conspiracy.”

The agency said the complaint alleged the promoters of NDTV, acting in a criminal conspiracy with unknown officials of ICICI bank, violated Section 19(2) of the banking regulation act and also a “master circular” of the Reserve Bank of India.

The CBI added that ICICI bank took the entire shareholding of the promoters in NDTV, which comes to nearly 61%, as collateral and accepted prepayment of the loan by reducing the interest rate from 19% a year to nearly 9.5 %.

“As a consequence, causing a wrongful loss of Rs 48 crore to ICICI bank and a corresponding wrongful gain to the promoters of NDTV,” the CBI said.

The agency pointed to the 1988 anti-corruption law to clarify its jurisdiction in the case as ICICI Bank is a private sector entity. “… provisions of the prevention of corruption act are applicable to officials of private banks”.

First Published: Jun 06, 2017 17:53 IST