ED issues to Kolkata builder under FEMA
New Delhi: Government has issued show-cause notice to a Kolkata-based builder under Foreign Exchange Management Act (FEMA).
The builder, Sanjay Jhunjhunwala, is the promoter of Mani Group. The notice has been issued by the Enforcement Directorate (ED) in relation to numerous alleged illegal deals and trading in overseas currencies worth Rs 206 crore, according to media reports.
The builder was allegedly trading in overseas currencies illegally in Singapore. He also had illegal overseas external borrowings, apart from keeping unauthorized bank accounts in Singapore and other countries.
A number of intelligence reports were shared with the ED and Financial Intelligence Unit (FIU).
ED found that Jhunjhunwala was the owner of an account kept at a prominent bank in Singapore. The account was in the name of Tiger Woods International which is a company established in British Virgin Island.
ED also found that the builder entered into an joint venture deal a foreign national for making investment in real estate projects in Rajarhat locality of Kolkata. It was found that no such real estate project was started or undertaken by Jhunjhunwala and in the name of the joint venture deal, he opened overseas bank accounts. Jhunjhunwala was the beneficial owner of the accounts thus opened.
ED found that no investment was done by the builder but he cleverly routed various transactions to India by way of an arbitration award granted in Singapore.
ED also found that the builder opened an individual bank account with LGT Bank (Singapore). He then made various transactions using this account in foreign currencies by big borrowings in overseas currencies, This was found to be violation of FEMA rules.