For alleged violations of the foreign exchange regulations in relation to the foreign assets held by the late mining businessman Anil Salgaocar, the Enforcement Directorate (ED) has issued a seizure order against his estate.
The Foreign Exchange Management Act of 1999’s section 37A (1) was used by the ED to issue the order.
Anil Salgaocar, a former Goa MLA, is the target of an inquiry by the ED based on the Panama Papers and Pandora Papers disclosures. Salgaocar is reported to have formed many BVI (British Virgin Islands) corporations.
Salgaocar held iron ore mines in Goa and Karnataka, the ED learned over the course of the inquiry.
His Indian group companies only sold and exported the iron ore that these mines generated to Special Purpose Vehicles (SPVs) in Singapore and the British Virgin Islands.
However, these SPVs did not register with the Indian authorities and carried on business as trading firms, allowing the export of Indian iron ore to China. Profits were transferred outside of India as a result of this.
Through iron ore trading, Anil Salgaocar’s five BVI businesses made earnings of about USD 690,650,641 (or roughly Rs 5718 crore). These earnings were not disclosed to the Indian government.
The ED claims that Salgaocar violated section 4 of the FEMA, 1999 by having assets outside of India and accumulating foreign currency.
Salgaocar’s full stock, which was given to his estate, has been taken by the ED.
33 companies are included in this shareholding, with ownership stakes ranging from 0.1% to 99.9%. These 33 firms also possess a total of 441 immovable properties, the most of which are in Goa. A handful of these assets are also located in Mumbai and Karnataka.
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