ED Seizes 9 Assets Of Horti Firm That Created Subsidiary To Buy UK Property

Mumbai: The Enforcement Directorate (ED) has seized nine immovable properties worth Rs65.53 crore of M/s Venkateshwara Hatcheries Pvt Ltd (M/s VHPL) under the provisions of the Foreign Exchange Management Act (FEMA),1999. The assets have been seized in Maharashtra and Karnataka, in connection with alleged illegal remittances made by the company to its wholly owned subsidiary, M/s Venky’s Overseas Limited (M/s VOL), in the UK, since 2011.

The ED investigation has revealed that M/s VHPL declared the business of M/s VOL to RBI as agriculture and mining (rearing of ducks, hens etc) and remitted huge funds – 73,96,069 pounds (Rs65.53 crore) – in the guise of equity infusion. However, no such business activity was ever initiated by M/s VOL even after 11 years of incorporation.

As per the probe, M/s VOL used the remitted funds to repay the loan taken from Barclays Bank to acquire a 90-acre property, Alexander House, in the UK, for use by the Indian firm’s directors, employees and family members. Agency officials said the Indian firm had no intention to conduct any bona fide business through its subsidiary.

Initiating action against the Indian firm, the agency seized the equivalent value of properties in India under FEMA, and further investigation in the case is underway.