The Enforcement Directorate (ED) conducted searches at several premises of the Niranjan Hiranandani Group on Thursday, over alleged violations of rules under the Foreign Exchange Management Act (FEMA). Those being probed include Niranjan Hiranandani, his son Darshan Hiranandani, who was recently in the news on the Mahua Moitra controversy, and their group entities.
Allegations and details of searches
The ED action started in the morning and was on at the time of going to the press. The premises searched include the residence of Niranjan Hiranandani, the registered and corporate offices of the group entities in Powai.
According to the Sources, Niranjan Hiranandani and his family members were allegedly the beneficiaries of an offshore trust, which had accumulated assets of more than USD 60 million. The group was also named in the Pandora Papers. According to sources, the Hiranandanis allegedly set up at least 25 companies and a Trust in the British Virgin Islands between 2006 and 2008. They also allegedly routed investments of more than Rs. 400 crores in the form of FDIs received in group companies with real estate projects in Maharashtra and Tamil Nadu.
It has been gathered that the utilisation of the amount was not in accordance with prescribed government guidelines. According to the sources, one of the group entities which received FDI, did not repay loans taken from a consortium of banks and was declared NPA. Interestingly, the incomplete project was then taken over by another Hiranandani group entity in DRT proceedings.
Other than the ED, the income tax department is also probing the Hiranandani group over alleged tax violations. In March 2022, the Income Tax Department searched around 25 premises of the Hiranandani Group, spanning three cities - Mumbai, Bengaluru, and Chennai. The searches, according to sources, were carried out over suspected tax evasion by the group.
Official statement of Hiranandani Group
According to the official spokesperson of Hiranandani Group,”we have extended full cooperation to the department by facilitating all the relevant information and clarification sought by them. Since the inquiry pertains to a 15 year old development - it took time to dig out old records. The Group understands that ED is satisfied that there were no FEMA violations. The group will remain cooperative and law abiding.”
