No restrictions on RRPR Holding for warrant conversion, says I-T dept

RRPR Holding, the promoter entity of the New Delhi Television (NDTV), does not need the income tax department's approval for converting warrants into equity shares to Visvapradhan Commercial (VCPL), an indirect subsidiary of Adani Enterprises, the latter said late on Friday. 

In a disclosure to the stock exchanges, VCPL said it had approached the IT department for clarity on the matter and received a reply from the Additional Commissioner of Income Tax, dated September 7, that there were no restrictions on RRPR to carry out the exercise of warrants into equity.

"The prohibition under orders u/s 281B during the period of their operation is on M/s. RRPR Holding Private Limited for selling or transfer of its shareholding in M/s. New Delhi Television Limited and from creating/causing any charge only, irrespective of the shareholding pattern of M/s. RRPR Holding Private Limited who exercises control thereon and not on the issuance of shares of M/s. RRPR Holding Private Limited, " the reply said. 

The reply follows RRPR's contention last week that it would need the go-ahead from the IT department for converting the warrants, which was 29.18 per cent. 

On the same day, Adani Enterprises rejected RRPR Holding's claim, saying it had no merit or basis in law or in fact, and was misconceived.

"The IT Orders only apply to the shares of NDTV held by RRPR and in no manner restricts RRPR from completing the formalities in relation to allotment of equity shares to VCPL on the exercise of the warrants," it said in an exchange filing.

The company said that VCPL had called upon RRPR to withdraw its contention and desist from repeating misleading statements. "VCPL has again called upon RRPR to take all necessary steps and perform its obligation as specified in the notice, forthwith and without any further delay," it said. 

AMG Media Networks, a wholly-owned subsidiary of Adani Enterprises, acquired VCPL for Rs 113.7 crore in August, adding that it had exercised its rights to convert warrants held by VCPL in RRPR into equity shares. This triggered a mandatory open offer for an additional 26 per cent stake in the media company, which will happen on October 17.