Chanda Kocchar conflict of interest

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CHANDA KOCHHAR’S

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CONFLICT OF INTEREST

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ICICI Bank managing director and CEO Chanda Kochhar quit the bank on October 4 amid allegations of a conflict of interest. The Indian Express on March 29 had first reported that Videocon group promoter Venugopal Dhoot provided crores of rupees to NuPower Renewables Pvt Ltd (NRPL), a firm he had set up with Chanda Kochhar s husband Deepak Kochhar and two relativ es, six months after the Videocon group got Rs 3,250 crore cro re as loan from ICICI Bank Ba nk in 2012. He transtra nsferred proprietorship of the company compa ny to a trust owned by Deepak Kochhar for Rs 9 lakh, six months after he received the loan from ICICI Bank.

HERE IS

THE INDIAN EXPRESS INVESTIGA INVESTIGATION THAT THA T UNEARTHED THE CONFLICT CONFLIC T OF INTEREST

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March 29, 2018

Vid ideo eocon con gets gets Rs 3250 3250--cror croree loan from ICICI Bank, bank CEO’s hu husb sban and d gets swee sweett de deal al from fro m Venu enugo gopal pal Dho Dhoot ot Promoter Venugopal Venugopal Dhoot forms JV with Chanda Kochhar’s husband, loans Rs 64 crore, then hands him ownership of lending entity for Rs 9 lakh; ICICI Bank declares Videocon account NPA. Sandeep Singh, Krishn Kaushik report.

From left to right: Managing Director of NuPower Deepak Kochhar, Kochhar, Promoter of Videocon Group Venugopal Dhoot and CEO and MD ofICICI of ICICI Bank Chanda Kochhar.

IN DECEMBER 2008, Venugopal Venugopal Dhoot of the Videocon Group set up a company with Deepak Kochhar, husband of ICICI Bank MD and CEO Chanda Kochhar, Kochhar, and two of her relatives; then gave gave a Rs 64-crore loan to this company through a fully owned entity before he transferred transferr ed the latter’s l atter’s ownership to a trust headed by Deepak Kochhar for just Rs 9 lakh, an investigation by The Indian Express has found. In what raises questions questions of propriety and and conflict of interest, the transfer transfer of the company to Deepak Kochchar happened six months after the Videocon Group got got a loan of Rs 3,250 crore from from ICICI Bank. Almost 86 per cent of that loan (Rs 2,810 2,810 crore)

Copyright © 2018 The Indian Express

remains unpaid and Videocon account was declared an NPA in 2017. Sources have confirmed to The Indian Express that the Dhoot-Kochhar Dhoot-Kochhar-ICICI -ICICI web of transactions is being examined by investigative agencies. A day after The Indian Express sent a detailed questionnaire to ICICI Bank for its response to its findings, ICICI Bank issued a press release Wednesday Wednesday evening saying “there is no question question of any quid pro pro quo/nepotism/conflict of interest as is being alleged alleged in various rumours.” It said the Board “reposes full faith” in Chanda Kochchar and added that “malicious and unfounded rumours” were being spread to “malign

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Sources have confirmed to The Indian Express that the Dhoot-Kochhar-ICICI Dhoot-Kochhar-ICICI web of transactions is being examined by investigative agencies.

the Bank.” The statement, however, did not address the specific query from The Indian Express on Deepak Kochchar-Venugopal Dhoot transactions or the conflict of int inter erest est..

Consider the sequence of events and transactions, as per records investigated by The Indian Express: In December 2008, 20 08, Deepak Kochhar and Venugo Venugopal pal Dhoot set up NuPower Renewables Pvt Ltd (NRPL). Dhoot held 50 per cent stake in the company with his family members and associates. Deepak Kochhar and Pacific Capital owned by Deepak Kochhar’s father and Chanda Kochhar’s brother’s brother’s wife held the remaining 50 per cent. n

In January 2009, Dhoot resigned as director of NuPower and transferred his 24,999 shares in the company to Kochhar for Rs 2.5 lakh. n

In March 2010, 2010, NuPower NuPower got a loan of Rs 64 crore (as fully convertible debenture) from a company called Supreme Energy Private Private Limited which was 99.9 per cent owned by Dhoot. n

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Following Follo wing a sequence sequence of tran transfer sfer of shar shares es from


Dhoot to Kochhar and then from Kochhar and his relatives’ Pacific Capital to Supreme Energy, Supreme Energy became a 94.99 per cent shareholder in NuPower NuPow er by the end of March 2010. 2010. Kochhar held the remaining 4.99 per cent stake in NuPower at the time. In November 2010, Dhoot transferred his entire holding in Supreme Energy, Energy, to his associate Mahesh Chandra Punglia. n

Beginning September 29, 2012 to April 29, 2013, Punglia transferred his holding to Pinnacle Energy, a trust, where Deepak Kochhar was the managing trustee. The total total transaction value value of the complete transfer of shares from Punglia to Kochhar’s Kochhar’s Pinnacle Energy trust: Rs 9 lakh. In effect, Supreme Energy gave gave a loan of Rs 64 crore to NuPower and then got subsumed by Pinnacle Energy within three years. ICICI Bank did not respond to queries sent by The Indian Express on these financial transactions, share transfers between Dhoot/Videocon companies and companies run by Deepak Kochhar, and on the issue of conflict confl ict of inter interest. est. But on the issue of loan granted to Videocon Group, Group, the bank said: “In 2012, 2012, a consortium of over 20 banks and FIs where State State Bank of India was the facility facility agent (Lead) sanctioned facilities to the Videocon n

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group (Videocon (Videocon Industries Ltd. and 12 12 of its subsidiaries/ associates as co-obligors) for a debt consolidation programme and for the group’s oil and gas capital expenditure programme aggregating approximately Rs. 40,000 crore…ICICI Bank sanctioned its share of facilities aggregating approximately Rs 3250 crore which was less than 10% 10% of the total consortium facility in April 2012.” It further said “The current outstanding against this loan is Rs 2810 crore and total current exposure to Videocon group is Rs 2849 crore…The Videocon group account has been classified as an NPA during 2017.” When contacted, Venugopal Dhoot said, “On January 15, 15, 2009, I resigned as a director of NuPow NuPower er Renewables and Supreme Energy Private Ltd and sold at par the 24,996 shares shares of NuPow NuPower er and 9,990 shares of Supreme Energy held by me, thereby thereby relinquishing my right, title and interests in the said shares, giving up control and management of Supreme Energy and completely disassociating disassociating myself myself from both the Companies all on the same day, as I got too busy with my other larger business like oil & gas, telecommunication, etc.” NuPower NuPow er stated the same in its response to the email sent by The Indian Express. However,, Registrar However Registrar of Companies filings of Supreme Energy show that Dhoot owned it until October 2010 and then transferred his share holding to Punglia in November 2010. Nupower also said that it has no concern or connection with ICICI Bank’s lending to companies owned by Venugopal Dhoot. On the question question of confl conflict ict of inter interest, est, a spokesper spokesper-son for NuPower NuPower said: “There is no conflict of interest whatsoever and the above transactions have nothing to do with any loans processed by ICICI Bank. Pinnacle Energy trust and Supreme Energy have no business relationship with ICICI Bank.” As of March 2017 2017, for which latest RoC records are available, availab le, Deepak Kochhar held an aggregate aggregate of 43.4 per cent in NuPo NuPower wer both as direct holding and through Supreme Energy and Pinnacle Energy Energy.. The remaining holding is with Mauritius-based DH Renewables. Renewa bles. As of March 31, 31, 2016, 2016, Kochhar along with Supreme Energy and Pinnacle Energy held 96.23 per cent. While the company came into existence in December 2008, it announced net losses in last six financial years. In the six years from FY’12 to FY’17, the accumulated losses for NuPower amounted to Rs 78 crore. In FY’17 FY’17 it posted a loss of Rs 14.3 crore. crore.

Detailed responses from ICICI Bank, Venugopal Dhoot below

ICICI Bank This refers to your email dated March 27, 2017 addressed to Ms. Kochhar and her team. I would like to clarify that the purported allegations allegations of conflict of


interest in your mail are completely baseless and unfounded. As a matter of practice, the Bank does does not comment on client specific issues. However, However, given the various insinuations in your email, I give below the answers to you questions.

SECTION A Question 1. In 2012, ICICI Bank has not sanctioned loans to the five companies mentioned in your mail.The factual details details of the loan facilities sancsanctioned in April 2012 to the Videocon group are given below: A. In 2012, 2012, a consortium of over 20 banks and FIs where State State Bank of India was the facility facility agent (Lead) sanctioned facilities to the Videocon group (Videocon Industries Ltd. and 12 12 of its subsidiaries/ associates associates as co-obligors) for a debt consolidation programme and for the group’s oil and gas capital expenditure programme aggregating approximately approximately Rs. 40,000 crore. B. ICICI Bank’s current exposure to the Videocon group is part part of this syndicated consortium consortium arrangement. C. ICICI Bank sanctioned its share of of facilities aggregating approximately Rs. 3250 crore which was less than 10% of of the total consortium consortium facility (including a short-term loan of Rs. 650 crore as a sub-limit) in April 2012. D. The Information Memorandum (IM) and the initial due diligence for the financing programme was was prepared by the lead arrangers namely SBI CAPS and IDBI Bank. E. After the preparation preparation of the IM by the lead lead arrangers and and after the sanction of the facilities by SBI and IDBI Bank, the Credit Committee Committee of ICICI Bank in 2012 201 2 sanctioned its share share of facilities in the syndicated arrangement to the Videocon group. F. This committee was chaired by the then Chairman of ICICI Bank and it included many many independent and working working Directors of the Bank. It is important to note that Ms. Kochhar was not the Chairperso Chair person n of this committee. committee. G. The Terms and Conditions offered for these l oans are similar to those offered by the other banks in the consortium, ruling out the possibility of any special special benefit to the borrow borrower er by ICICI Bank. H. Please note that ICICI ICICI Bank’s share of the banking sector’s exposure to the Videocon group was less than 10% while around around 90% of the loans were sanctioned by other banks and FIs.

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Question 2: The current outstanding against this loan is Rs. 2810 crore. Question 3: In 2012, no loans were granted to Tuskar Overseas Inc. by ICICI Bank or any any of its branches/ subsidiaries. Question 4: There is currently no loan outstanding to Tuskar Overseas Overseas Inc. from ICICI Bank or any of its branches/ subsidiaries. Question 5. The total current exposure to Videocon group is Rs. 2849 crore. Question 6. The answer to this is the same as Question no. 5 Question 7. The Videocon group account has been classified as an NPA during 2017.

SECTION B Your other questions do not pertain to us and our clients, but given the insinuations made in your mail, I would also like like to state that none none of the investors of NuPower NuPo wer Renewables Renewables are borrowers borrowers of ICICI Bank.

overseen by the Board of the Bank. The proceedings of the Credit Committee are presented to the Board on a periodic basis and the Board has clear supervision and control on the decisions of the Credit Committee. Committee. Based on the above, it can be observed that there are multiple functions to appraise, rate and monitor the credit decisions at the Bank. Accordingly, it can be concluded that there are adequate checks & balances in loan appraisal, rating and approv approval al processes within the bank, both from the control as well as from a governance perspective. Given this architecture, no individual employee, whatever may be his or her position, has the ability to influence the credit decision at the Bank. All the details as mentioned above clearly demonstrate that there there is no conflict of interest as mentioned in your mail. We do not expect a responsible newspaper like you to lend your platform to rumours to mar the reputation of an organisation and an individual. Hence, we we strongly urge you not to write or publish anything in any form form of media (print/digital/social (print/digital/social media) which projects ICICI Bank and/or its MD & CEO in poor light. Trust this serves to clarify and dispel any misgivings you may have on the subject. I am willing to speak to you tomorrow for any further clarification. MK Sharma Chairman, ICICI Bank Ltd.

SECTION C I would also like to inform you that the Bank has a well-structured well-structur ed and standardised credit approval process, which includes a well-established procedure of comprehensiv comprehensive e credit appraisal, credit credit approvals approvals and monitoring. I am mentioning the details below: A. The Credit Risk Management Group (CRMG), which whic h is independent independent of the business business groups groups of the Bank, evaluates and assigns a credit rating to the credit proposals. A borrower’s credit rating is a vital input for the credit approval process. Every proposal for a financing facility is prepared by the relevant business unit and reviewed and rated by the CRMG before being submitted for approv approval al to the appropriate authority. B. The Bank’s credit approval authorization framework is laid down by by the Board of Directors C. The authorisation framework framework is risk based with lower rated borrowers and/or larger exposures being escalated to higher committees. The larger exposures are approved approved by the Credit Committee of the Board D. The majority majority of Credit Committee members members are independent directors of the Bank. E. The Chairman of of the Credit Committee, Committee, till as late late as June 2015, was always a non-Executive Director. F. The functioning of the Credit Committee Committee is closely


NuPower Renewables At the outset we would like to say that we have no concern or connection with ICICI Bank’s lending to companies owned by Mr. Venugopal Dhoot. The facts stated in your email are not correct. The correct facts are explained below: Answer no 1: Mr. V N Dhoot Dhoot resigned from the board of of directors of NuPow NuPower er Renewables Renewables and Supreme Energy Pvt Ltd on January 15, 2009, and on the same day he sold at par his 24,996 shares of NuPow NuPower er Renewables and also sold to a third third party his 9,990 9,990 shares of Supreme Energy at par on on account of being busy with other engagements. Hence, he gave gave up control of of Supreme Energy and completely completely delinked himself from both the companies’ w.e.f. January 15, 2009. Hence Mr. Dhoot has no concern or interest with Supreme Energy beyond January 15, 2009. Supreme Energy’s investments in fully convertible debentures (FCD) (FCD) of NuPow NuPower er Renewables Renewables of value Rs. 64 crores were allotted in March 2010. At all times, Supreme Energy’s holding, on fully converted basis, taking into account the equity shares and other convertible securities held by other shareholders/investors, holders/investo rs, was never 95% in Nupow Nupower er Renewables. Renewab les. Upon conversion of the FCD in March 2016 201 6 and conversion of convertible instruments held

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by other shareholders/in shareholders/investors, vestors, Supreme Energy’s equity shareholding was just 10.1%. Other than the said 24,996 shares subscribed at the time of incorporation (which (which were subsequently subsequently sold) neither Mr Dhoot nor Videocon hel d any shares in NuPower Renewables. The subscription amount of the fully convertible convertible debentures were were used towards towards acquisition of wind power projects. Answer no. 2: Pacific Capital sold 22,500 shares of NuPow NuPower er Renewables Renewa bles to Supreme Energy in June, 2009 at par (which was at the then fair market value) since at the time of incorporation Deepak Deepak Kochhar had subscribed to shares and convertible instruments which were subsequently converted converted into equity shares in March 2012. Answer no. 3: Pinnacle Energy trust purchased the 9,990 shares of Supreme Energy at Rs. 10 per share from the then existing shareholder on 29thSeptember 29thSeptember,, 2012 being higher than the fair market value value of Rs. 8.82 per share, and then it further invested Rs. 8 lacs to subscribe to 80,000 shares of Supreme Energy Energy in April 2013 2013 at fair market value value by way of fresh investment. At no time did the Pinnacle Energy trust along with Supreme Energy Energy ever hold more more than 50% of the share capital of NuPo NuPower wer Renewables Renewables (on as converted converted basis). Answer no. 4: There is no conflict of interest whatsoever whatsoever and the above transactions have have nothing to do with any loans processed by ICICI Bank. Pinnacle Energy and Supreme Energy have no business relationship with ICICI Bank.

Venugopal Dhoot reaction to queries 1. I was invited as an initial Director of NuPow NuPower er Renewables Renewa bles formed on 24th December 20 08 due to my experience in Solar Energy projects and subscribed to 24,996 shares of NuPow NuPower er at par. However,, on 15th January 2009, i.e. within 20 days I However resigned as a Director of NuPo NuPower wer Renewables Renewables and sold at par the 24,996 shares of NuPow NuPower, er, and completely disassociated myself myself from NuPower NuPower Renewables on that day, as I got too busy with my other larger business like oil & gas, telecommunication, etc. 2. Besides the 24,996 shares shares of NuPow NuPower er held by me and sold sold off immedi immediatel ately y being of valu value e only Rs 2,49,960/-, neither Videocon nor me held any shares in NuPower. Me and my family members did not own 50% in NuPower Renewables at all ever. 3. The allegation allegation of confl conflict ict of inter interest est is substancesubstanceless and denied.


Loans are sanctioned by Banks including ICICI Bank by a Committee of of Directors before before whom a detailed detailed Project Appraisal and Risk Analysis carried out by various departments of the Bank are presented presented for loan sanction. Hence no individual can indulge in favouritism. Further, Further, our loan sanctioned by ICICI Bank in 2012 was was under a consortium of several Banks led by SBI at the same terms as sanctioned by the consortium Bankers. ICICI Bank took took its share of the loan in the consortium. 4. These five companies mentioned in your email, i.e. Trend Electronics Limited, Century Appliances, Kail Limited, Value Industries Limited and Evans Fraser & Company had never ever been disbursed any funds in April 2012 by ICICI Bank and they have no outstanding dues to ICICI Bank or any other banks as on date. The only funds sanctioned by ICICI Bank in April 2012 201 2 was to Videocon Industries Limited, which was a sum of Rs.1 Rs.1500 500 crore under consortium funding of 20 banks with SBI as the lead and the sanction was on the same terms and conditions of the other consortium banks. With regard to Tuskar Overseas Inc, the loan was disbursed in 2006 and there is no outstanding as on date as it was paid off in 2010. 2010. The current loan outstanding from ICICI Bank is only to Videocon Industries Limited, being only Rs.1400 Rs.1400 crore, which is is very small compared to other banks.

Part 2 Further to my email to you yesterday, I would like to state that on 15th January, 2009, I resigned as a director of NuPow NuPower er Renewables Renewables and Supreme Energy Private Ltd and sold at par the 24,996 shares of NuPower NuPow er and 9,990 shares of Supreme Energy held by me, thereby relinquishing my right, title and interests in the said shares, giving up control and management of Supreme Energy and completely disassociating myself from both the Companies Companies all on the same day, as I got too busy with my other larger business like oil & gas, telecommunication, etc. The said 9,990 shares shares of Supreme Energy duly sold on 15th January, 2009 were handed over to the purchaser along with transfer deed on the same day and the consideration for the same was immediately received by me from the purchaser. Therefore I have no connect with the business of Supreme Energy nor Nupower Renewables since 15thJanuary, 2009. As explained above the initial 24,996 shares held by me in NuPower Renewables were sold at Rs. 10 per share. Besides these shares, neither Videocon nor me held any shares in NuPower Renewables. For all other information sought i n your current email, you may kindly contact NuPower Renewables for the same. With best regards, V N Dhoot

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April 3, 2018

ICICI Bank CEO and MD Chanda Chand a Kochhar

Cha handa nda Ko Koch chh har’s brot brothe her-in-law r-in-law advised advised ICICI borr borrowers owers on their foreign loans Avista Advisory, Advisory, founded by Rajiv Kochhar, Kochhar, brother-in-law brother-in-law of Chanda Kochhar, got mandate to restructure foreign currency-denominated debt deals deal s worth over $1.7 $1.7 bn of 7 companies. companies. Sandeep Singh, Krishn Kaushik report WHILE ICICI BANK CEO and MD Chanda Chanda Kochhar’s Kochhar’s husband Deepak Kochhar’s transactions with Videocon promoter Venugopal Venugopal Dhoot are under the scanner of investigative agencies, another potential potential conflict-of-interest link has emerged, this time with a Singapore-based Singapore-ba sed financial services company founded by Deepak Kochhar’s brother. Avista Advisory, founded by Rajiv Kochhar, who is the


brother-in-law of Chanda Kochhar, brother-in-law Kochhar, got the mandate to restructure foreign currency-denominated currency-denominated debt deals worth over $1.7 $1.7 billion of seven companies over over the last six years. All these companies were borrowers borrowers of ICICI Bank at the same time. In at least one of these deals, ICICI Bank was was the lead bank bank of the lenders. lenders. According to disclosures made by Avista Advisory,

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the company acted as an advisor in restructuring debt of Jaiprakash Associates, Jaiprakash Jaiprakash Power Ventures, Ventures, GTL Infrastructure, Infrastructure, Suzlon, JSL and Videocon Group. In 2017, Avista acted as “Debtor Advisor” in the restructuring of foreign currency convertible bonds bonds (FCCB) of Jaiprakash Associates amounting amounting to $110 $110 million. While Avista advised on the FCCBs, ICICI Bank was the lead bank in the consortium of banks that lent to Jaiprakash Associates. Avista also acted as “Debtor Advisor” in the restructuring turin g of $200-m $200-million illion FCCB of Jaipr Jaiprakas akash h Power Power Ventures Ltd. In this case, too, ICICI Bank was a lender to the company and also received equity under the corporate corporat e debt restructuring package. FCCB is a convertible bond issued in a foreign currency. Market experts say that in many cases of stressed assets in India, these were issued to prevent a default in the domestic market. In 2014, Avista was the “Creditor Advisor” for the restruct res tructuring uring of $57 $577-mil 7-million lion worth worth of FCCB of Suzlo Suzlon. n. In the case case of Suzlon Suzlon,, ICICI Bank Bank was one one of its lenders. In November 2012, Avista acted as “Debtor Advisor” for FCCBs worth $306 million for GTL Infrastructure. ICICI Bank was a lender to GTL Infra and took 29.3 per cent stake in the company in July 201 2011 as part of the loan restructure. Another case where Avista acted as “Debtor Advisor” was to Jindal Stainless in 2016 which was also a borrower borrower of ICICI Bank. Avista mentions two loan restructuring deals involving the Videocon Group on its website. Avista acted as “Creditor Advisor” for two FCCB deals of Videocon Industries worth $194 million and $97 million in 2015 and 2016 respectively. Responding to a questionnaire from The Indian Express, an ICICI Bank’s spokesperson said: “We would like to categorically state that ICICI Bank has never engaged Avista Advisory Group for any services at all. Your Your mail itself indicates that the said entity claims to be an advisor to various corporates. You You may refer any query regarding Avista Advisory Group to the firm and its clients.” The spokesperson added: “Kindly also note that the brother of of a husband does not fall within the definition of a “relative” under the Companies Companies Act, 1956 1956 or 2013 or the Rules thereunder. Hence there is no

requirement of any disclosure of such a relationship by any any official official of the Bank…In Bank…In view of all the above, above, your insinuation of conflict of interest is totally totally basebaseless and malafide in intent.” Responding to questions mailed to Rajiv Kochhar by The Indian Express, Avista Advisory said: “There is no conflict. confli ct. The entire process process of selec selection tion of “Deb “Debtor tor Advisor” was competitive. We were chosen as a “Debtor Advisor” Advisor” in the restructuring restructuring of the FCCBs of Jaiprakash Associates Limited, Jaiprakash Jaiprakash Power Venturess Limited and GTL Infrastructure Limited. In Venture these restructuring transactions, transactions, the “Debtor” “Debtor” of the FCCBs were the respective Companies and the “Creditor” were the respective Foreign Currency Convertible Bondholders who are “Foreign Investors” in these FCCBs. Avista advised the Companies in the negotiation with these Foreign Investors in order to restructure the FCCBs. Since the FCCB restructuring transaction did not involve any negotiations between the Companies and the “Domestic Lenders/ICICI Bank”,, there is no conflict of inter Bank” interest est of whats whatsoeve oeverr nature.” It further said, “There were no dealings with ICICI Bank at all in any of the above transactions…W transactions…We e would like to clarify that in the restructuring cases handled by Avista Advisory, Advisory, the firm has not interacted with ICICI Bank in any manner or form. Further during the course of the restructuring restructuring transactions Avista has not raised or mobilized any funds for its clients from ICICI Bank. Avista was involved involved in discussion and negotiation only between the Indian Company and the Foreign Creditors.” On the Videocon case, Avista said: “In the two Videocon deals referred in your email, Avista was appointed by the Foreign Creditors (i.e. the Foreign Investors in the FCCBs issued by Videocon) to restructure and recover the investment made by them in the FCCBs. Accordingly, Avista Avista acted as the “Creditor Advisor” and was not the advisor to the Videocon Group. We would also like to clarify that we represented the Foreign Investors and did not represent any Domestic Lenders/ICICI Bank. These Foreign Creditors who had invested invested in the FCCBs include some of the leading Global Institutional Investors who had appointed Avista in order to assist them to restructure and recover the amounts invested by them in the FCCBs.

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April 26 , 2018

Essar pr Essar prom omot oter er ki kin’ n’s fi firrm inv in vested in Chanda Chanda Koch chh har husband’ss co husband’ com mpan any y NuPower, promoted by Deepak Kochhar, husband of Chanda Kochhar, NuPower, Kochhar, between 2010 201 0 and 2012 2012 got investments investments of Rs 325 crore from Mauritius-based Firstland Holdings, a company company owned by Nishant Kanodia, son-in-law of Essar Group co-founder Ravi Ruia. Sandeep Singh, Krishn Kaushik report WHILE INVESTIGATING INVESTIGATING agencies are probing investments by a Mauritius-based company into NuPower Renewables, the company promoted by Deepak Kochhar,, husband of Chanda Kochhar, Kochhar Kochhar, MD and CEO of ICICI Bank, between 2010 2010 and 2012, records records of the Registrar of Companies show that NuPower NuPower got investments of Rs 325 crore from from Mauritius-based Firstland Firstland Holdings, a company owned by Nishant Kanodia, sonin-law of Essar Group co-founder co-founder Ravi Ruia. The investments from Ruia’s son-in-law’s firm into NuPower started in December 2010. Incidentally, the same month ICICI Bank was lead banker in a consortium of Indian banks that extended a $530-million loan to Essar Steel Minnesota LLC on December 29, 2010. This loan was later classified as NPA. December 29, 2010: 2010: ICICI Bank, as mandated lead arranger, extended loan of $530 million to Essar Steel arranger, Minnesota Minne sota LLC LLC on behalf behalf of the consortiu consortium m n

December 31, 2010: Firstland Holdings invested Rs 49.90 crore in NuPower. n

August 3, 2011: Firstland invested Rs 8.69 crore in NuPower n

October 3, 2011: 2011: Firstland invested Rs 99.25 crore in NuPower n

March 21, 2012: Firstland invested Rs 166.5 crore in NuPower n

Responding to queries, Kanodia’s office said, “Firstland Holdings had made investments in NuPower


in 2010 and 2011. This investment was sold in 2013 to a private equity fund and Firstland recovered its full investment.” investme nt.” The company added: added: “None of the Kanodia group companies have any loans from ICICI.” In its response, Essar Group said it had “not made any investments in Firstland or NuPower.” Records show that Essar Capital Holdings Limited did invest Rs 163.54 16 3.54 crore in Matix Chemicals and Fertilisers, a subsidiary of Firstland Holding. This came in tranches: tranches: Rs 96.76 crore in December 2010 and Rs 66.78 crore in August 2011. Asked about these, an Essar Group spokesperson said, “Essar entities have business dealings with Matix Fertilizers and Chemicals Ltd. on arm’s length basis, and these have no connection whatsoever with NuPower.” While ICICI Bank did not respond to a specific query on whether Chanda Kochhar informed the board about her husband’s financial dealings with kin of Essar Group Group promoters promoters and and if she recused herself from the loan approval process, it said, “With regards to your query on Essar Steel Minnesota, we would like to inform you that a consortium of seven Indian banks including ICICI Bank had sanctioned loans to the entity. Also, large US funds gave loans to the company. Out of the total total debt of of the compan company y of USD 1.02 1.02 billion, billion, ICICI Bank’s share was less than 25%. Due to various factors, the loan facilities provided to this project were classified as nonperforming by all lenders. The resolution process pursuant to the same is under process.” It also said: “We categorically state that ICICI Bank has never sanctioned any loan to Matix Fertilisers and Chemicals Ltd.” Queries sent to NuPower did not elicit a response.

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June 21 , 2018

Mor oree conf confllict of int intere eresst? Mumbai house house of Ko Koch chha hars rs ha hass Vide ideocon ocon connec connecttion Income Tax Tax probes acquisition of CCI Chambers apartment in Mumbai by husband of ICICI Bank’s Chanda Kochhar Kochhar.. Khushboo Narayan reports

The CCI Cha Chambe mbers rs in Sou South th Mumb Mumbai: ai: Thi Thiss is whe where re the Koc Kochha hharr fam family ily liv lives. es.

THE INCOME Tax department is probing the acquisition of the current current family family residence residence of Chand Chanda a Kochhar,, the CEO and MD of ICICI Bank, in South Kochhar Mumbai by her husband Deepak Kochhar in a complex transaction involving firms linked to Videocon Group, sources have told The Indian Express. The link between Videocon and the residence of the Kochhars reinforces reinforces questions questions of propriety and conconflict of interest that have dogged dogged Chanda Kochhar Kochhar and are now the subject of an “independent” probe probe announced by the ICICI Bank. On Monday, the bank said she will be on leave until the probe is completed. The tax department, sources said, i s now probing


the transaction involving involving the acquisition of the flat at 45, CCI Chambers CHS Limited — it is in the Churchgate area area opposite the Cricket Cricket Club of India — and has informed the Central Board of of Direct Taxes Taxes (CBDT) about its findings so far. On March 29, The Indian Express first reported that Videocon promoter Venugopal Dhoot provided crores of rupees to NuPower NuPower Renewables Renewables Pvt Ltd (NRPL), a firm he had set up with Chanda Kochhar’s husband and two relatives six months after th e business group got Rs 3,250 crore as loan from ICICI Bank in 2012. Dhoot transferred transferred proprietorship proprietorship of the company to a trust owned by Deepak Kochhar for Rs 9 l akh, six

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months after he received the loan from ICICI Bank. The Videocon account was declared an NPA or a bad loan in 2017. Tax authorities have found that the Kochhar family’s residence since 1998 was bought through Credential Finance Ltd, a financial services firm set up by Deepak Kochhar and his brother Rajiv Kochhar in the mid-1990s, sources said. Due to financial stress, the company filed for liquidation and was suspended from trading in 1996-97. Seven members of the Kochhar family family and Videocon Videocon International had a stake of 2 per cent and 17.74 17.74 per cent, respectively, respectively, in Credential Finance as on 2001. In 2009, Videocon Industries Ltd (VIL) nominated Quality Appliances Pvt Ltd, a firm with links to the Videocon Group, to take over the flat from Credential Finance Finan ce in lieu of the final final settlement settlement of the amount amount due to VIL from Credential Finance, sources said. According to the agreement, Credential Finance transferred transferr ed the property to settle the money it had taken from VIL. “After 2010, the same flat was reacquired by Deepak Kochhar at a price, which was lower than the market price,” sources said. The tax department, sources said, has recorded the statements of all shareholders shareholders and directors directors of Quality Appliances and Credential Finance in connection with the case. Reached for comment by The Indian Express, Deepak Kochhar Kochhar said he is the owner owner of the flat at CCI Chambers since 1996. “The property belongs to me since the beginning, and the conveyance deed and share certificate certificate of the property are are in my name. I have given all the clarifications to the department,” he said. In an email response to queries from The Indian Express, Venugopal Venugopal Dhoot said: “The flat at 45, CCI is purchased and owned by Mr Deepak Kochhar since the very beginning over 20 years back. The said flat was never mortgaged to Videocon Industries Ltd. We have no concern with the said flat.” According to documents with the Registrar of Companies (RoC), Quality Appliances Pvt Ltd, which owned the flat at CCI Chambers after it was transferred from Credential Finance in 2009, is now known as Quality Techno Advisors Pvt Ltd. The registered office of the firm is 618, 618, Nariman Point in Mumbai, which is also the office of NuPow NuPower er Renewables Renewables Pvt Ltd, the company promoted by Deepak Kochhar. Quality Techno Advisors is now an advisory firm owned by Deepak Kochhar.

RoC documents show that Quality Appliances was set up in 2008 with Vilas Salunke and Kavishwar Patil holding 5,000 equity shares each. The firm’s registered address was in Andheri in suburban Mumbai, which was also the head office of of Videocon Telecommunications Telecommunica tions Ltd. Both Salunke and Patil have have been directors of various Videocon Group firms such as Videocon Industrial Finance Ltd, Videocon VCR Securities Ltd, Videocon Mining Ltd, Videocon Securities Ltd, Pacific Appliance Manufacturing and Trading Ltd, Dhoot Entertainment and Gaming Solutions Ltd and V N Communication Systems Ltd. According to the RoC documents, in 2009-10, Quality Appliances acquired an office premises for Rs 3.54 crore, and changed its registered office address in the official records from Andheri to 45, CCI Chambers in South Mumbai. In March 2010, three companies promoted by Videocon Industries — TekCare India Pvt Ltd, Evans Fraser & Co Ltd and Nippon Investment and Finance Company Pvt Ltd — together were allotted equity shares of 1 lakh at a premium for Rs 3.5 crore crore and became the majority majority shareholder of of the company holding 90.91 per cent stake. The remaining stake was held by Salunke and Patil. The company, according to its 2011 annual report, said that it “gave performance performance guarantee in favour of Supreme Supr eme Energy Energy Pvt. Ltd on behalf of NuP NuPowe owerr Renewables Ltd worth Rs 7 crore” that was valid up to March 31, 2013. Quality Appliances also said that the purchase of the office premises in 2009-10 2009-10 is shown as an investment in its accounts. In 2012, the TekCare India, Evans Fraser & Co and Nippon Investment and Finance Company sold their 90.91 per cent stake to Patil and exited Quality Appliances. This took the total total shareholding shareholding of Patil to 95.45 per cent. In 2013, Quality Appliances changed its name to Quality Techno Advisors Pvt Ltd and Patil continued to hold 95.45 per cent stake in the firm until March 2016, according to RoC documents. According to the latest available financial documents of March 2017 2017, the firm is owned completely by Deepak Kochhar through Quality Advisors (Trust). The company has also made made a provision of Rs 3.5 crore (50 per cent liability) towar towards ds the Rs 7 crore guarantee that it gave in favour favour of Supreme Energy Pvt Ltd on behalf of NuPow NuPower er Renewables Renewables Ltd in 2010-1 2010-11 1.

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Chanda Kocchar conflict of interest

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