Bennett Coleman and Company Limited (BCCL), one of the country’s largest media conglomerates and publishers of the Times of India Group of publications, is under the scrutiny of a Central investigating agency, The Indian Express has learnt.
Top managers of the company have faced rounds of questioning by the Enforcement Directorate (ED) with the agency recently sending formal requests for corroborative information to offshore destinations, sources confirmed to The Indian Express.
BCCL owns a suite of media and entertainment brands across several languages and platforms, including digital, TV and radio.
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Over the past few weeks, Sivakumar Sundaram, Chairman, Executive Committee (CEC) of the company; and Himanshu Agarwal, its Chief Financial Officer (CFO), have been called in for questioning at the ED headquarters in New Delhi.
Officials said that among BCCL’s financial transactions under the scanner are those to the tune of over Rs 900 crore between the company and entities in global tax haven British Virgin Islands (BVI).
The Indian Express has confirmed that, as of now, the ongoing “inquiry” is being conducted for alleged violations of the Foreign Exchange Management Act (FEMA) and not under the more stringent Prevention of Money Laundering Act (PMLA).
When contacted, agency officials declined to comment on the probe. They also did not elaborate on who else from the media group may be required to appear as the probe progresses.
Samir Jain, BCCL Vice Chairman, and Vineet Jain, BCCL’s Managing Director, did not respond to an emailed questionnaire from The Indian Express seeking their response on the ED summons and the transactions under scrutiny.
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The balance sheets of the company show that among the various Group companies is one MX Media Co Ltd, which is incorporated in the BVI.
The status of this BVI entity was shown as a “subsidiary” company in 2017-18 and 2018-19 with the parent company holding 52.35% equity. This was changed to the status of an “associate” company with the parent company’s equity diluted to 40.36% in the years 2019-2020 and 2020-2021.
Filings of the Reserve Bank of India (RBI) on outward FDI flow for the year 2019 show the company (MX Media Co Ltd BVI) listed as a joint venture dealing with “financial insurance and business services”, and that it has an equity of $35.8 million.
There are other “associate” companies of the Group listed in BCCL’s balance sheet, which have been incorporated in South Korea, China and Singapore.
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According to Registrar of Companies records, while BCCL’s revenue from operations amounted to Rs 9,611 crore in the year 2019-2020, it fell sharply by 44 per cent in the Covid year 2020-21 to Rs 5,337 crore.
The loss for the company also more than doubled from Rs 451 crore in financial year 2019-20 to Rs 997 crore in financial year 2020-21. BCCL had posted a net profit of Rs 484 crore in the financial year 2018-2019. (MSN)
