The action is linked to alleged foreign exchange violations involving overseas investments, transactions through British Virgin Islands entities, and funds routed through Mauritius.
The investigation began after the Securities and Exchange Board of India (SEBI) provided information about write-offs and provisions aggregating Rs 2,101.46 crore recorded in Reliance Power's books. These were linked to overseas investments and advances made to companies in the British Virgin Islands (BVI) and Cayman Islands.
The ED conducted searches under FEMA between March 6 and March 8, 2026, during which it said several incriminating documents were seized and statements of multiple individuals were recorded.
How the overseas transactions allegedly worked
According to the agency, Reliance Natural Resources Limited (RNRL), which subsequently merged with Reliance Power, raised $300 million through Foreign Currency Convertible Bonds in 2006.
Of this amount, $275 million was invested in its wholly owned Singapore subsidiary, Reliance Natural Resources (Singapore) Pte Ltd (RNRL-S).
The ED alleged that RNRL-S deposited these funds with Deutsche Bank (Suisse) SA in Geneva. The deposits were subsequently used as collateral for loans extended to entities incorporated in the British Virgin Islands.
The agency said its investigation found that these BVI entities were controlled and managed from India by the Reliance Anil Ambani Group through front persons acting on the group's directions.
ED flags alleged round-tripping
The ED alleged that the loan proceeds were used for various purposes, including temporarily routing funds back into India through foreign entities based in Mauritius.
"Further investigation has revealed that the loan proceeds were utilised for varied purposes, including temporary round-tripping of funds into India through foreign entities based in Mauritius. The funds were utilised for the benefit of the Reliance Anil Ambani Group and parties outside India."
The investigation also found that the BVI entities failed to repay the loans extended by Deutsche Bank.
As part of an alleged cover-up, the ED said documents were fabricated to show that RNRL-S and Indonesian subsidiaries of Reliance Power had provided advances to the BVI entities for apparently genuine business purposes.
The agency alleged that these documents were backdated and prepared to present the transactions as legitimate business dealings.
The seizure has been carried out under Section 37A of FEMA, which allows authorities to seize assets in India equivalent to the value of foreign exchange allegedly held abroad in contravention of the law.