As time passes by, more and more links, both personal and official, of the Chanda Kochhar family and the Videocon Group, are coming out in the open. They confirm a series of transactions between the Kochhars and Videocon, thus indicating close/tight links between them. The Indian Express reports that the Income Tax Department (ITD) is investigating charges of tax evasion, in the ICICI-Videocon deal in 2010, wherein ICICI sold its 13 storeys building called Radhika Apartments, located at a prime area of Prabhadevi in Central Mumbai for Rs.61 crores. This real estate deal took place at a rate of Rs.17000 per sq.ft., at a time when the rate in the area for such a building was Rs.25000 per sq.ft. Thus a bank like ICICI, which has recognized expertise in appraisal and due diligence of properties, sold a property worth about Rs.90 crores to the Videocon Group for a discounted price of Rs. 61 crores. This shady transaction merits deep investigation.
The ITD is also investigating a real estate deal, related to the residence where the Kochhar family has been residing since 2009. The allegation is that this apartment was acquired by a Deepak Kochhar owned company, from a Videocon Group company at a price lower than the prevailing market price. The transaction was multi-layered in such a manner that Videocon did not charge the prevailing market price for the sale of this posh apartment to the Kochhar family. The ITD is also investigating the investment of Rs.64 crores by the Videocon Group in the loss-making Deepak Kochhar entity. NuPower Renewables, which it finally sold to a Kochhar family trust for a paltry sum of Rs. 9 lacs, around the same time.
And despite so many deals between the Kochhar and the Videocon Group, and the preponderance of profitability says that there could be many more, Chanda Kochhar, in the 30 page letter to SEBI, in response to its show cause notice for non disclosure of conflict of interest and stark violation of standards of corporate governance claims that she was not aware of her husband’s deals with the Videocon Group. The very house that the Kochhar family resides in since the past decade was bought from the Videocon Group in a complex layered deal and she yet says that she has been unaware of her husband’s dealings with the Videocon Group. In her much delayed lengthy response to the SEBI notice, Ms. Kochhar seeks to exonerate herself, particularly citing that due to confidentiality clauses, she was not aware of the business dealings between the Videocon Group and her husband. If that be the story, she would certainly not be aware of her brother in law, Rajiv Kochhar’s extensive dealings with the Videocon Group. To us, it sounds utterly strange and unbelievable that a top notch banker, who heads India’s largest private sector bank and stays in a house acquired from the Videocon Group is unaware of her husband’s business dealings with it. Her brother in law extensively profited from Videocon and so did her husband and their family trust, but she is unaware of it all. No wonder the Indian banking system has collapsed.