In a signed statement, the managing director of the channel, Sharad Kumar, denied any connection "between the spectrum allocation made in 2007-2008 by the department of telecom and the loan given by the Cineyug Communications to Kalaingar TV in 2009".
The Rs 200 crore Cineyug gave to the channel was as an advance for shares, it said. "But due to differences in share valuation, Kalaignar TV assumed it as a loan till August 2009," after which the money was returned with an interest of Rs 31 crore.
The details of transactions were provided to the Income Tax department and tax had been paid, claimed Sharad in the statement. "Everything was done within the legal framework. It is an open book," he said.
Opposition leader J Jayalalithaa, meanwhile, said DMK president and chief minister M Karunanidhi and his family members should be included as co-accused in the spectrum scam probe to "unearth the whole truth".
Drawing parallels between the suspicious transaction involving Kalaignar TV and the Sarkaria Commission report that probed corruption charges against the DMK chief, Jaya said the same person was behind both dealings.
Jaya detailed a portion of the commission report in which the judge noted a circuitous accounting pattern and alleged that the case was similar in the Kalaignar TV-Cineyug transactions.
The AIADMK chief Shahid Usman Balwa, now under CBI custody in connection with his role as the co-promoter of Swan Telecom, was connected to Cineyug and other companies.
She said the money paid to Kalaignar TV was a kickback paid to A Raja's "lord and master" Karunanidhi for facilitating the sale of shares to Etisalat by Mumbai-based real estate firm Dynamix Balwa the original promoters of Swan.
"Balwa transfers funds...totalling Rs 209.25 crore from 11 different companies controlled by him to Kusegaon Fruits and Vegetables, a company owned by Asif Balwa and Rajiv Agarwal. From this, Kusegaon transfers Rs 206.25 crore to Cineyug Films, owned by Balwas and Morani. Cineyug's balance sheet for 2009-10 shows that an unsecured loan of Rs 206 crore was given to the Chennai-based Kalaignar TV, in which Karunanidhi's second wife Dayalu and his daughter by his third wife, Kanimozhi, jointly hold 80 per cent of the stakes," Jayalalitha said.