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In 2007, INX Media had approached Chairman of FIPB, seeking his permission for issuing equity shares to three non-resident investors who were based in Mauritius through the FDI route. Each share was to be priced at Rs 10 a piece. This money was supposed to be used for creating and operating a number of television channels. However, the application also mentioned the company’s intention to make a downstream financial investment to the extent of 26 per cent of the issued and outstanding equity share capital. However, the FIPB cleared the FDI proposal for a sale of Rs 4.62 crore only. But categorically denied permission to the downstream investment. However, in violation of FIPB approval, the downstream investment generated FDI exceeding Rs 305 crore in the company “by issuing shares to foreign investors at a premium of more than Rs 800 per share.”
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