ED notice to SRK

The Enforcement Directorate has issued a show cause notice to Knight Riders Sports Pvt Ltd (KRSPL) and Bollywood actor Shah Rukh Khan’s wife Gauri Khan for allegedly violating foreign exchange rules.

The agency issued the notice under the Foreign Exchange Management Act (Adjudication Proceedings and Appeal) Rules, 2000 in connection with the share sale of KRSPL. The franchise is owned by Shah Rukh Khan’s company Red Chillies Entertainment Pvt Ltd in partnership with actor Juhi Chawla and her husband Jay Mehta.

“We issued a show cause notice to Knight Riders Sports, Gauri Khan and others under FEMA for loss of foreign exchange worth Rs 73.6 crore in sale of shares,” an official said. The agency had also issued summons to Shah Rukh Khan in the matter in 2015 and before that. The matter pertains to the 2008 share transfer, audited by an external firm in 2014. It noted that shares sold to Jay Mehta-owned Sea Island Investment were eight-nine times undervalued by KRSPL.