File photo of Shah Rukh Khan performing at the SAP Center in San Jose, Calif. (Amar D. Gupta | Siliconeer)


Shah Rukh Khan has been served summons by Enforcement Directorate in connection with allegedly irregular sale of shares of Knight Riders Sports Pvt. Ltd. (KRSPL) to a Mauritius-based company of actor Juhi Chawla’s husband Jay Mehta.


The case pertains to 2008-09 regarding the share sale of KRSPL owned by Shah Rukh Khan’s Red Chilies Entertainment along with Juhi Chawla and her husband.

“This is the third time that summons have been sent to Khan and we are expecting him anytime soon as his presence is needed for some information that is in his exclusive knowledge,” said ED sources, Oct. 27.

The summons were sent to SRK earlier this month.

ED is probing allegations that shares sold to Chawla’s husband Jay Mehta-owned Sea Island Investments were undervalued by eight to nine times.

Khan had faced ED once in 2011 when he was questioned about alleged foreign exchange violation of around Rs. 100 crore.

The agency has already recorded the statements of Chawla and Mehta.

At the time of incorporation in 2008, Red Chillies Entertainment had 9900 shares of KRSPL. The valuation report, made by ED’s external agency last year, said that when the equity shares of KRSPL were issued to Sea Island Investments, the fair value per equity share of KRSPL should be between Rs. 70-86. However, the shares were issued at a value Rs. 10 each.

According to Foreign Exchange Management Act (FEMA), the price of shares issued to persons residing outside India should not be lower than the price worked out under the guidelines set by stock market regulator SEBI, in case of a listed company or on the basis of fair valuation of shares by a chartered accountant as per guidelines of the erstwhile Controller of Capital Issues (CCI).

When contacted, a spokesman of the actor said “no comments.”