The Enforcement Directorate on Monday said it has issued a fresh order to seize assets worth more than Rs 24 crore of prominent hatchery company -- Venkateshwara Hatcheries Pvt Ltd -- as part of a probe against it related to alleged violation of the foreign exchange law.
The federal agency said in a statement that it has seized six immovable properties located in Maharashtra and Karnataka under the provisions of the Foreign Exchange Management Act (FEMA).
The total value of these assets is Rs 24.64 crore.
The ED probe relates to "illegal remittances made by the company since 2010, till date, to its wholly owned subsidiary named Venky's London Limited, Cardiff, UK."
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The agency, last month, had similarly seized assets worth Rs 65 crore in this case.
It said Venkateshwara Hatcheries Pvt. Ltd. (VHPL) incorporated Venky's London Limited, Cardiff, UK (VLL) as its wholly owned subsidiary in the year 2010 at Cardiff, UK.
"VHPL declared the business of VLL to RBI as engaged in recreation activity in the form of running a football club named Blackburn Rovers Football Club PLC (BRFC).
"After the incorporation of VLL, VHPL remitted huge funds in the guise of equity infusion," it alleged.
Apart from the initial investment, the company kept on infusing money in the form of equity contribution for day-to-day maintenance of the loss making club without earning any profit out of the said investments, it said.
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VHPL made remittances to the tune of GBP 21,90,83,419 (equivalent to INR 1,963.60 crore) to VLL since its incorporation till date, the ED stated.
Out of said investments, it added, Venkateshwara Hatcheries Pvt. Ltd diverted investment to tune of GBP 33,78,378 to acquire 53,00,000 shares of entity named M/s Hitlab Inc. Canada.
The agency said this Canadian entity is partially owned by an American Singer Akon who reportedly performed at the private birthday party of one of the promoters of VHPL-- B Balaji Rao, in Pune.
Probe found that VHPL made investment of GBP 33,78,378 (equivalent to Rs 24,61,82,405) in an unrelated loss making entity. It was made with a non-bonafide intention since it goes against their own declared purpose of investment, the ED said.
It claimed "multiple" FEMA contraventions were seen in these transactions.
"Apart from mis-declarations in the remittances, VHPL wrongly claimed these remittances as equity infusion in its wholly owned subsidiary, but in reality, the intention was to siphon off huge amount to an unrelated loss making entity," it said.
The said investments were not declared to RBI and hence, the equivalent value of properties held in India have been seized under the provisions of Section 37A of FEMA, the agency said.
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