February 4, 2013- The Enforcement Directorate (ED) has slapped three penalties worth around Rs.100 crore on actress Shilpa Shetty Kundra’s Indian Premier League (IPL) team Rajasthan Royals.
The penalty was imposed for various contraventions of the Foreign Exchange Management Act (FEMA). The agency had found that the foreign investment in franchise Jaipur IPL Cricket Pvt Ltd (JIPL) was made in flagrant contravention of FEMA.
The Jaipur team, co-owned by the actress and her husband Raj Kundra, had received several show cause notices in April 2011 from the ED for “severe irregularities in foreign investment”.
The ED had found that the foreign investment in JIPL was made much prior to its incorporation and funds were remitted in an irregular manner and shares were sought to be issued in contravention of FEMA.
The adjudicating authority confirmed the ED findings and held that JIPL, its directors and foreign investors have committed contraventions under FEMA. Accordingly, three penalties were imposed — Rs.50 crore on JIPL and its directors, Rs.34 crore on Mauritius-based EM Sporting Holding and its directors including Manoj Badale and Suresh Chellaram and Rs.14.5 crore on United Kingdom-based ND Investments and its directors.
The violators have been directed to pay the respective penalties to the ED within 45 days.
