Mumbai: Kolkata Knight Riders (KKR) – the defending champions of the eighth edition of the Indian Premier League (IPL) – ran into rough waters as its co-owner Shah Rukh Khan has been summoned by the Enforcement Directorate (ED) for undervaluation of shares of the franchise.
The ED is likely to show cause Khan but before that, the officials want him to answer a few questions.
According to reports, earlier the ED discovered shocking audit findings that indicated forex violation of Rs 100 crore.
The audit conducted for the ED concluded that the transfer of shares between Knight Riders Sports Private Limited (KRSPL) and Sea Island Investment (SIIL) – owned by Jay Mehta – was undervalued by the respective bodies.
As per Foreign Exchange Management Act (FEMA) guidelines, the price of shares issued to individuals residing outside India should not be lower than the price shown under the regulations set by stock market regulator SEBI.
The ED deduced that the value of shares owned by SIIL was inconsistent with the price guidelines.
KKR was asked to explain the situation before March-end which was the deadline.