Mumbai, June 24: The Enforcement Directorate (ED) has launched a significant investigation into Rajesh Exports Limited (REL) and its associates for alleged violations of the Foreign Exchange Management Act (FEMA). This operation involved searches at nine locations of the company in Bengaluru and Mumbai, as announced in an official statement on Wednesday.
The ED’s investigation has uncovered several serious irregularities. According to the agency, Rajesh Exports Limited failed to provide records related to its foreign transactions.
The company did not submit documents concerning outstanding payments and receipts related to imports, exports, foreign investments, and international trade. This lack of documentation has made it nearly impossible to verify the authenticity of these transactions.
Furthermore, the ED noted that no documents or records related to the company’s investment of ₹10,350 crores in African mines were found during the searches, nor has the company provided them to date.
The investigation also revealed that the company was adjusting trade liabilities and receivables with suspicious firms located in the United Arab Emirates (UAE) and other foreign territories.
According to the ED, the amount involved in these transactions is approximately ₹30,000 crores, which is currently under investigation.
Physical verification conducted during the raids revealed a significant discrepancy between the company’s stock records and the actual stock available. The ED reported a difference of nearly 40% between the stock recorded in the factory register and the stock present on-site.
The agency also identified several anomalies in the company’s key business indicators. For instance, the salary levels for senior management were found to be disproportionately low compared to the size of the business.
The ED noted that the Chief Financial Officer (CFO) has not received any salary since 2020, while the Managing Director (MD) was reportedly earning only about ₹17,000 per month.
This situation arises despite the company reporting a consolidated revenue of approximately ₹7.7 lakh crores.
The investigation has also uncovered suspicious block trades in the company’s shares conducted by certain individuals. The names of these individuals are included in the leaks released by the International Consortium of Investigative Journalists (ICIJ), raising concerns about potential undisclosed offshore links, which are currently under scrutiny.
Additionally, it was revealed that over ₹600 crores may have been sent out of India through alleged manipulation of shares using “NRI benamidars.”
The statement indicated that during the search operations that began on Tuesday, the ED seized several crucial documents and digital evidence.
The agency stated that the seized documents and electronic records are being examined, and further investigations into the matter are ongoing.
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