CBI said it is investigating into the roles of all persons involved
New Delhi: The Enforcement Directorate (ED) Wednesday said it has seized Indian assets worth Rs 2,033 crore belonging to Reliance Power Ltd (RPL), an entity of the Reliance Anil Ambani Group, under Foreign Exchange Management Act (FEMA), for the alleged siphoning of assets worth an equivalent amount to tax havens of British Virgin Islands (BVI) and Cayman Islands.The attached assets include bank balances of RPL and its shareholding in Sasan Power Limited. "The Headquarter Investigation Unit has seized assets worth ₹2,032.81 crore in India belonging to RPL, which are equivalent to the foreign exchange held outside India in contravention of FEMA," ED said. ED has already attached assets worth thousands of crores of the Anil Ambani group, including his residences in Mumbai, in multiple money laundering cases involving over Rs 40,000 crore.ED said its investigation into findings of Sebi, pertaining to write-offs/provisions aggregating ₹2,101.46 crore made by RPL in its books of account, had revealed that "these write-offs were related to overseas investments and advances made to companies in the British Virgin Islands (BVI) and the Cayman Islands".In a statement released to BSE and NSE Tuesday, RPL said the ED order of seizure of assets "relates to foreign currency convertible bonds issued in 2006, i.e.
20 years ago, and the related overseas investment made in 2008, i.e. 18 years ago, in a subsidiary in Singapore with all applicable approvals. The seizure primarily pertains to the shares held by the company in its wholly owned subsidiary Sasan Power Ltd, which are already pledged in favour of Power Finance Corporation Ltd (a govt undertaking) under security arrangements for more than 10 years, as well as certain bank balances of the company".ED had conducted related searches in March and seized "several pieces of incriminating evidence", recording statements of several persons. "Investigation has revealed that Reliance Natural Resources Ltd (since merged with RPL) raised $300 million through foreign currency convertible bonds in 2006. Of this, $275 million was invested in its wholly owned Singapore subsidiary Reliance Natural Resources (Singapore) Pte Ltd (RNRL-S)."RNRL-S placed these funds on deposit with Deutsche Bank (Suisse) SA, Geneva. The deposits were used as collateral for loans extended to entities incorporated in the British Virgin Islands. The investigation found that the BVI entities were controlled and managed from India by the Reliance Anil Ambani Group (RAAG) through front persons, who acted as per the group's directions," ED said.
Further, the loan proceeds were utilised for varied purposes, including temporary round-tripping of funds to India through foreign entities based in Mauritius, the central agency said, adding that this was done to benefit the RAAG."The BVI entities failed to repay the loans extended by Deutsche Bank. As part of cover-up, documents were fabricated to show that RNRL-S and Indonesian subsidiaries of RPL had made advances to these BVI entities for apparently genuine business purposes. During investigation, it was found this documentation was backdated and prepared in order to project these transactions as genuine business transactions," ED said.
Further investigation is in progress.