I-T SEARCHES KANODIA OVER NUPOWER INVESTMENT
by its Mauritius-based First land Holdings into Deepak Kochhar’s NuPower Renewables through cumulative convertible preference shares. SHRIMI CHOUDHARY reports
The income-tax department is conducting a search operation on Matix group Vice- Chairman Nishant Kanodia and related persons in connection with investment of ~3.25 billion by its Mauritius-based Firstland Holdings into Deepak Kochhar’s NuPower Renewables through cumulative convertible preference shares (CCPS).
Firstland is a company owned by Nishant Kanodia, son-in-law of Essar group co-founder Ravi Ruia.
The searches follow tax investigation into multiple transactions, involving Deepak Kochhar’s company NuPower, Videocon Industries and other related parties in India and abroad. Confirming the development, a senior tax official said searches were underway at eight locations including Mumbai, Kolkata and Panagarh, in West Bengal. According to him, the searches would continue till Friday and could also affect other related entities.
Sources said the tax department was examining the veracity of the financial transactions between Kochhar and Matix and the probable links with some of the Essar group of firms. Tax sleuths are said to have been tipped off about overvaluation of capital goods in Matix companies and undisclosed foreign assets.
This is the first big action by the investigators since the ~32.5 billion VideoconICICI Bank loan matter surfaced. The Central Bureau of Investigation (CBI), too, had registered a preliminary enquiry against Kanodia for the alleged nexus between Deepak Kochhar and Videocon group chairman Venugopal Dhoot.
The transaction comes under I-T radar since Firstland, which is the part of the Matix group run by Yogendra Kanodia and son Nishant, sold the CCPS to another Mauritius-based entity DH Renewables, a subsidiary of Accion Diversified Strategies Fund, based in Cayman Island for ~3.25 billion in 2011 and 2012.
Under the original resolution, Kanodias’ investment would have resulted in 49 per cent stake in NuPower, which it relinquished in favour of DH Renewables Holding, the company that bought the CCPS from Firstland.
Firstland’s CCPS were to be converted into equity shares of NuPower. “Post-conversion of all the CCPS into equity shares of the company, the investor will hold equity shares representing 49 per cent of the share capital of the firm calculated on a fully diluted basis,” as per the Registrar of Companies filings seen by Business Standard.
Kanodias received neither dividend nor capital gains on its NuPower investment. The original resolution on the CCPS did not provide any details on dividend payments.
An email sent to Matix group on Thursday evening remained unanswered till the time of going to press.
Meanwhile, the tax authorities have sent letters to Mauritius and Cayman Island authorities seeking more information on the fund since the antecedents of DH Renewables and Accion Diversified Strategies Fund are not known.