IPL: ED summons Shah Rukh Khan over alleged forex violation

Bollywood superstar and co-owner of IPL team Kolkata Khight Riders Shah Rukh Khan has been summoned by the Enforcement Directorate (ED) for the third time for alleged violation of Foreign Exchange Management Act (FEMA) norms.

The KKR franchise is co-owned by the actor's company Red Chillies Entertainment Pvt Ltd, Juhi Chawla and her husband Jay Mehta. Shah Rukh had earlier ignored the ED’s summon issued in May this year and this time the agency has asked him to be present before it by the first week of November before Diwali.

“Shah Rukh's presence is required to conclude the investigation. Only after this we could raise the demand order and show cause notice (SCN) against the said violation," an ED official was quoted as saying by a newspaper.

The agency has recorded statements of other KKR shareholders Juhi Chawla and her husband Jay Mehta in May this year. But Khan could not make it till now, as he is busy shooting,” the official further added.

According to investigations by the ED, the actors IPL franchisee, the Knight Riders Sports Pvt Ltd (KRSPL) is suspected to have violated FEMA norms by undervaluing its shares in a transfer deal with Jay Mehta's Mauritius-based company, Sea Island Investments Ltd (SIIL).

The ED interrogated the actor for the first time on November 2011 to explain the details of transactions / aspects of the KRSPL deal, due diligence conducted on SIIL before allotment of shares to them and reasons behind KRSPL allotting 50 lakh shares to SIIL at a value which appears to be understated.