ED seizes 9 properties worth Rs 65.53 cr of Venkateshwara Hatcheries

Directorate of Enforcement (ED) has seized nine immovable properties in Maharashtra and Karnataka estimated to be around Rs 65.53 crore  belonging to Pune-based M/s Venkateshwara Hatcheries Pvt Ltd (M/s VHPL) under the provisions of Foreign Exchange Management Act (FEMA),1999.

ED in its release  had stated that it had  initiated investigation in connection with the illegal remittances made by the company since 2011 till date to its wholly owned Subsidiary named M/s Venky’s Overseas Limited (M/s VOL), UK. ED investigation revealed M/s VHPL declared the business of M/s VOL to RBI as agriculture and mining (rearing of ducks, hens etc).

After the incorporation of M/s VOL, M/s VHPL remitted huge funds in the guise of equity infusion. However, no such business activity was ever initiated by M/s VOL even after the lapse of more than 11 years from its incorporation. ED investigation further revealed that M/s VHPL had made remittances to the tune of GBP 73,96,069 equivalent to INR 65.53 Crore to M/s VOL since its incorporation till date.

M/s VOL immediately after its incorporation, had purchased an immovable property named “Alexander House” having total area of 90 acres in the United Kingdom through the funds remitted by M/s VHPL with a view to provide convenience to the Directors and employees of VHPL, the agency added.

Further all the funds remitted by M/s VHPL to M/s VOL subsequently were utilised for repayment of loan obtained by M/s VOL from Barclays Bank, UK which was taken for acquisition of said immoveable property. Investigation established that M/s VHPL had no intention to conduct bonafide business through its subsidiary M/s VOL and it was created as a front to purchase an immovable property in the UK for the ultimate enjoyment by the directors, employees and family members of M/s VHPL.

Therefore, the equivalent value of properties held in India have been seized under the provisions of Section 37A of FEMA. Further investigation is under progress, the ED claimed.