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AIADMK's charge against Chidambaram

Special Correspondent

He secured loan from foreign institution to firm owned by son: memorandum


  • "No security offered for loan to Halidon Marketing Services"
  • "SEBI rules violated in sale of shares by Karpagambal Mills"

    New Delhi: Members of Parliament belonging to the All-India Anna Dravida Munnetra Kazhagam on Wednesday sought the intervention of President A.P.J. Abdul Kalam for the dismissal of Union Finance Minister P. Chidambaram for alleged abuse of office in securing a Rs. 6 crore loan from a foreign institution to a company floated by his son and nephew.

    In a memorandum, the MPs, led by P.G. Narayanan, alleged that Mr. Chidambaram got the loan from RABO Finance, which operates from Mumbai. It was alleged that this outfit of RABO Bank of Netherlands sanctioned the loan to Halidon Marketing Services Private Ltd., said to be owned by his son Karthik and nephew Palaniappan, without any security in violation of banking norms. The AIADMK alleged that as Finance Minister, Mr. Chidambaram had to deal with files relating to the grant of licence to RABO Bank for its full-fledged operations as a banking company in India. "While Mr. Chidambaram is having the files of an applicant seeking licence for banking activities on his table for clearance, his son's company is getting a `loan' of about Rs. 6 crores from the said foreign origin bank, and it is stated that no security was offered at the time of the grant of loan," the memorandum alleged.

    It also made various allegations about the sale of shares by Karpagambal Mills, in which Mr. Chidambaram and his brother, Lakshmanan Chettiar, held shares, to Halidon Marketing Services in violation of Securities and Exchange Board of India rules. The memorandum said it was placing before the President a few issues so that he could order a CBI probe into the allegations against Mr. Chidambaram and other connected persons.

    "Outrageous allegations"

    In response, S. Bhaskararaman, Charatered Accountant and Consultant to the purchasers, has issued this press release:

    "The members of the family of Shri P. Chidambaram protest the outrageous allegations made in a memorandum submitted by certain members belonging to the AIADMK and released to the media.

    "The textile mill in question is a family-controlled business since 1956. The family has three branches. In 2004, the first branch of the family decided to withdraw from the business and offered to sell its share holding to the other two branches. The transaction was concluded at an agreed price.

    "The purchasers raised a loan from a registered NBFC after providing adequate security to the lenders.

    "This is a normal family arrangement among private citizens belonging to a family, and it was done in a transparent manner."

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