ED raids on Z Estates under FEMA, Rs. 1.39 crore seized

The Enforcement Directorate (ED), Bhubaneswar Zonal Office, conducted search operations at nine locations in Odisha, Delhi and Gurugram under the provisions of the Foreign Exchange Management Act (FEMA), 1999 on November 22 in connection with an investigation being carried out against M/s Z Estates Private Limited (ZEPL) & others. 

The ED on Monday shared the details of the search operations in a press release. 

As per the press release, the office and residential premises of the Directors and key persons of M/s ZEPL and its partnership concern M/s Z Harshpriya were raided. 

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“ED initiated an investigation against M/s ZEPL for violation under the FEMA,1999 in respect of receiving Foreign Direct Investment from abroad by way of round-tripping of funds through foreign entities formed and located abroad,” read the release.  

“The search operation was conducted on the basis of suspected violations in receipt of foreign investments by way of issuing equity shares and premium shares to foreign entities in lieu of such investments, ED is suspecting probable hawala transactions and round tripping of funds to M/s ZEPL from abroad through various foreign entities,” added the release. 

As per the release, unaccounted cash amounting to Rs. 1.39 crore along with various incriminating documents in respect of foreign investment received by M/s ZEPL have been recovered and seized.

The ED also shared about the searches and the money seized during the operations in a post on its X handle. 

However, when contacted, Tapan Mohanty, director of Z Estate, said, “This is not a raid but a search. They came to three to four places. This was a very normal happening. We have brought foreign direct investment under FEMA since 2007. And everything like RBI declaration, FEMA permission and RBI permission has been complied with. If the authority wants to check the bona fides, they are welcome. I can declare that everything has been legally done and every legal procedure has been followed.