Searches, summons, detection of violations: ED’s Pandora probe touches Indian owners of offshore firms

The data was obtained by the International Consortium of Investigative Journalists (ICIJ) and shared with 150 media partners – The Indian Express investigated the Indian names on the list. The Centre announced the setting up of a Multi Agency Group (MAG) to spearhead the probe.

Subsequently, the Income Tax Department is known to have sent directives to a majority of Indian nationals; the Financial Intelligence Unit (FIU) until end 2022, sent requests to foreign jurisdictions for 482 people named in the reports.

In several cases, the ED sent “Egmont requests” – notes to the Egmont Group, the umbrella organisation of financial intelligence units of 167 jurisdictions, to glean more information about the offshore entities.

An investigation reveals the following updates: on the probe against the key names in the Pandora Papers.

1. ANIL AMBANI

Pandora file: Anil Ambani, chairman of ADA Group, and his representatives own at least 18 offshore companies in Jersey, British Virgin Islands and Cyprus. Set up between 2007 and 2010, seven of these companies borrowed and invested at least $1.3 billion. Service providers who managed these companies said that their loans from banks were “guaranteed by Reliance/Anil Ambani in order to make investments…” Ambani’s lawyer had then said all disclosures had been made in compliance with Indian law.

Probe update: ED has sought details on all reported entities; three Indian companies have been issued directives and Egmont requests have been sent to FIU-BVI, Cyprus and Jersey. Summons were sent to Anil Ambani and his wife Tina Ambani under provisions of FEMA and their statements have been recorded at ED’s Mumbai office.

2. BAVAGUTHU RAGHURAM SHETTY

Pandora File: Shetty was detained by authorities in Bengaluru in 2020 for non-payment of hefty loans to a slew of Indian banks. He had set up a complex offshore company network in Jersey and the BVI, mostly in 2013, and these companies hold shares of branches of his flagship company, Travelex Holdings Limited. Shetty’s wife and other family members are shown as Directors of some of the companies.

Probe update: Summons were sent to him and his top executives in September 2022, his statement was recorded in December 2022. ED has alleged FEMA violations to the tune of Rs 1,122.49 crore in the complaint it has filed which includes a prayer for confiscation of agricultural properties to the tune of Rs 53.25 crore.

The Pandora Papers refers to a trove of 11.9 million secret documents from 14 offshore service providers that gave details of ownership of 29,000 offshore entities used by the super-rich to manage their global money flows.

3. GAUTAM SINGHANIA

Pandora File: Gautam Hari Singhania, Chairman and Managing Director of Raymond Limited acquired two companies in the BVI in 2008. One is Deras Worldwide Corporation, where he is the Beneficial Owner, with the purpose of acquisition shown as ”to hold an account with UBS, Zurich.” The other is Lyndonville Holdings Limited, where Singhania and his father Vijaypat Singhania are shown as shareholders. This company was liquidated in 2016.

Probe update: After initiation of a FEMA probe, an Egmon request was sent to the BVI and reply received; queries were also sent to the RBI. Income Tax has been asked if any cases under the Black Money Act are pending against any member of the Singhania family. At least three summons have been sent to Gautam Singhania and his father, Vijaypat Singhania.

The father recorded his statement on April 27, 2023 in which he denied any association with Deras. In response to a second summons, the statement of Gautam Singhania was recorded on June 1, 2023. Travel details of the Raymond’s scion have also been sought from the Bureau of Immigration.

4. JOHN McMALLUM MARSHALL SHAW (HUSBAND OF KIRAN MAZUMDAR SHAW)

Pandora File: John Shaw, a UK citizen and husband of Biocon chief Kiran Mazumdar Shaw owned 99% of Mauritius-based Glentec International. As Settlor, Glentec set up the Deanstone Trust in New Zealand in 2015. Kiran Shaw said Glentec details were disclosed to SEBI and RBI. John Shaw passed away in 2022.

Probe update: The ED initiated action under FEMA provisions; has issued inquiry letters to SEBI, Income Tax and RBI which have been partially replied to. In September 2022, the ED sought additional information from IT authorities. Egmont requests have been sent to New Zealand and Mauritius and further investigation is on.

5. SACHIN TENDULKAR

Pandora File: Tendulkar and his family members were Beneficial Owners of a BVI company, Saas International Limited. The first reference to the company goes back to 2007 with Saas International being wound up in 2016 soon after the publication of the Panama Papers. When liquidated, the shares of the company were bought back by the shareholders, Tendulkar, his wife Anjali Tendulkar and her father. Pandora records showed the family listed as PEPs (Politically Exposed Person) since Tendulkar was also an ex-MP. Officials from Tendulkar’s office had then called the BVI investments “legitimate.”

Probe update: Invoking FEMA, ED sent a communication to Income Tax for ITR details of the cricket star. Directives were sent to the CEO of Tendulkar’s company and his Chartered Accountant asking for information on Saas. An Egmont request has been sent to FIU of the BVI. Further investigations are in progress.

6. OM PRAKASH BHARTIA & FAMILY 

Pandora File: The Bhartia family that runs the Sitaram Bhartia Institute of Science and Research in Delhi set up a trust in the Cayman Islands in 2006 which acquired a company, Carmichael Inc. At one point, it had two Swiss Bank accounts and assets worth $35.39 million. Om Prakash Bhartia was the beneficial owner of Carmichael; he then claimed these investments were all “tax compliant.’’

Probe update: ED contacted RBI and FIU and based on data from the latter, summons were sent to members of the Bhartia clan. Their replies revealed that a declaration under Section 59 of the Black Money Act (dealing with declaration of undisclosed foreign assets) was made of Rs 245 crore and a penalty of Rs 147 crore has been paid. Further investigations are on.

7. NIIRA RADIA

Pandora file: Radia incorporated about a dozen offshore entities, five of these showed her as the master client with her Delhi address. Records had a slew of hefty financial transactions (including the purchase of a $251,500 watch in Dubai through one of the BVI companies) with emails showing that she was a “do not contact” client. Radia had then said she did not recognise these companies and had no shareholding in them.

Probe update: Citing FEMA, ED asked Radia to provide details of the offshore companies and recorded her statement. Searches were conducted at her home under the Prevention of Money Laundering Act (PMLA). Data seized from these searches has been sent for analysis and fresh summons were issued to her. ED also recorded the statement of Radia’s sister, Karuna Menon.

8. HARISH SALVE

Pandora file: Salve acquired The Marsul Company in the BVI in 2015 to own a property in London. He’s named as the Beneficial Owner (BO) and Secretary of the company and was flagged as a PEP. Salve had then said he bought shares in Marsul for holding the property and that since he was an NRI he did not need RBI’s permission for buying shares of an offshore company.

Probe update: ED recorded that an investigation is already under process into Salve since his name figured in the Panama Papers – and that the Pandora Papers input has been included. For Marsul, an Egmont request has been made with FIU-BVI and requests have been made with IT authorities for details of his returns. Further investigation is on.

9. GAJ SINGH

Pandora file: The former Maharaja of Jodhpur and MP was connected with a BVI entity Atalante Perennity Inc. This was liquidated in 2018 with emails showing that offshore service provider staff were unsure how Singh, the Beneficial Owner, had given his address as the Umaid Bhawan Palace in Jodhpur. Gaj Singh’s representative had then said they had “no idea” about the offshore company.

Probe update: FEMA investigations are in progress; ED sent summons to him and the statement of his representative recorded in May 2023. Inquiries made with Income Tax authorities, the RBI and Banks concerned. An Egmont request relating to Warre Limited, UK – the company connected to him – was sent and replies received.

10. GAURAV BURMAN

Pandora file: Gaurav Burman lent $2 million to Bantree International Ltd, a BVI company, to its Mauritian subsidiary Colway Investments Ltd. Colway, in turn, was a shareholder in KPH Dream Cricket, owners of IPL team Kings XI Punjab.

Probe update: ED sent Egmont requests to Mauritius and BVI. Summons issued to KPH Dream Cricket Private Ltd. Bank records received show payments to the tune of Rs 4.67 crore made to a third party without having any tripartite agreement. Statement of Mohit Burman, one of the directors of KPH, recorded. Voluminous forex transactions under scrutiny for possible FEMA contraventions.

11. ARVIND SINGH MEWAR

Pandora file: Mewar set up Far East Trust in BVI, giving his Udaipur palace as his residence. He is shown as Settlor. A complex offshore structure was built around the trust which was primarily set up to hold a property in London. In 2015, the property was sold for 1.94 million pounds.

Probe update: ED sent inquiries to RBI and IT along with letters to a clutch of Indian banks linked to Mewar’s accounts. Summons issued to the former Maharaja. Inquiry on for allegedly making payments directly from his UK bank to his company in the UK, the Lake Palace Hotels and Models UK Limited.

12. SAMIR THAPAR

Pandora file: An offshore stakeholder of JCT Ltd, which has been declared as a “non-promoter” by the Indian textile giant, is linked to its chairman and managing director Samir Thapar. Records in September 2011 show Thapar as the holder of all 50,000 shares of Musk Holdings Ltd (BVI). In the same year, records show, he acquired Zanha International Ltd, another BVI entity, as its beneficial owner. While records in Pandora Papers list Thapar as the sole shareholder of Musk Holdings, JCT’s official documents identify “non-promoter” Francatina Development Inc as its ultimate beneficial owner.

Probe update: FEMA probe on, IT authorities have reported to ED that Samir Thapar has not disclosed any foreign assets in his tax returns. Inquiries sent to banks. In April 2023, a fresh directive was sent to Thapar asking for investment details.

13. LALIT GOYAL

Pandora file: Goyal, co-founder of Ireo real estate group, moved assets, investments and shareholdings worth an estimated $77 million to an offshore structure which included four entities registered in the BVI. These entities were set up as “investment vehicles.” This was before the group posted huge losses and was accused of illegally siphoning off investors’ money by two New-York based investment companies.

Probe update: Goyal was arrested in November 2021 and searches conducted under PMLA. He was later granted bail. Egmont requests were also sent to help identify his foreign assets, particularly in the UK and UAE. In October 2022, assets of Ireo and Goyal worth Rs 1,317 crore were attached by the ED.

14. MALVINDER SINGH/SHIVINDER SINGH

Pandora file: Former Ranbaxy promoters Shivinder Singh and Malvinder Singh set up two offshore firms in the BVI in 2009: Clonberg Holdings and Forthill International Ltd, which own an apartment each in London. Shivinder Singh mortgaged some properties of Forthill to borrow 5.1 million pounds from Barclays Bank. Spouses and children of the two brothers were shareholders of the offshore firms. The brothers were arrested in 2019 and face charges of money laundering and fraud.

Probe update: A PMLA case was in progress against the two before the Pandora investigation. Following searches carried out in May 2022 at Malvinder Singh’s residence, a bank account of his was traced in Singapore where “proceeds” had been credited. That account has been frozen. A property in the name of Shivinder Singh and his wife Aditi Singh was sold and its proceeds were allegedly transferred to conman Sukesh Chandrashekhar and are now being traced.

15. SANJAY CHANDRA/PREETI CHANDRA

Pandora file: Preeti Chandra,  wife of Unitech promoter Sanjay Chandra, set up an offshore family trust and acquired a Dominican passport. Formed in 2015, Trikar International Inc (BVI) was to hold assets for the family trust set up with Preeti Chandra as protector. Bellmora Ltd (BVI) was incorporated as the “named beneficiary in the Chandra Family Trust” in 2015 to hold investments in UAE and India, and a bank account in UAE.

Probe update: ED has a PMLA case against the promoters. In 2022, there has been a provisional attachment of properties valued at Rs 1,057 crore and a letter has been sent to UAE to enforce attachment order. An MLAT (mutual legal assistance treaty) request has been sent to the UAE for information on all the Chandras’ entities under scrutiny for alleged money laundering.

16. IQBAL MIRCHI & FAMILY

Pandora update: A trusted aide of underworld don Dawood Ibrahim, Mirchi passed away in 2013 and members of his family were first traced with 17 offshore companies in the 2016 Panama Papers and again, in the 2021 Pandora Papers. The latter revealed investments and transfers done by Iqbal Mirchi’s first wife, Hajra Iqbal Memon, and their two sons Junaid Iqbal Memon and Asif Iqbal Memon. And property investments by Akbar Asif, brother of Iqbal Mirchi’s second wife Heena Kauser.

Probe update: With a PMLA case already active, a fresh Egmont request has been sent to the BVI after the Pandora Papers revelations. Total assets for attachment of assets of Mirchi and his legal heirs – via four separate orders – has been estimated at over Rs 799 crore. Several prosecution complaints were filed against the family and in March 2021, a Red Corner Notice was issued for Hajra Memon and her sons. An extradition request has been sent to the UK for three members of Iqbal Mirchi’s family with the plea that they were wanted in India on charges of money laundering and acquiring assets by illegal means.

17. KAPIL/DHEERAJ WADHAWAN

Pandora file: Promoters of Dewan Housing Finance Corporation Limited (DHFL) Kapil Wadhawan and Dheeraj Wadhawan, in jail for over three years for having defrauded Indian banks to the tune of over Rs 88,000 crore, incorporated a string of offshore entities mostly in BVI and the Bahamas. The flagship BVI entity is V&M Aviation which entered into an agreement for the registration of a charge (loan) from Credit Suisse to buy a Bombardier Challenger aircraft for $22.65 million.

Probe update: A PMLA probe already on, Egmont requests have been sent to the BVI, UAE, Bahamas and Switzerland and replies are being analysed. Since the PMLA probe began, properties valued at Rs 2,013.08 crore of the Wadhawan brothers have been attached. These include foreign properties as well as foreign investments of the DHFL promoters.

18. BAKUL NATH/RAJIV SAXENA

Pandora file: Fresh evidence surfaced against persons named in the AgustaWestland helicopter deal: Bakul Nath, son of Congress veteran Kamal Nath and chartered accountant Rajiv Saxena in connection with a company, Pristine River Investment. An offshore company Spector Consultancy Services was opened for Bakul Nath by the same consultant linked to Pristine River. Saxena set up a Trust in 2014 with a BVI company Tanay Holdings Limited linked to ownership of 14 other companies or assets.

Probe update: ED initiated action against Bakul Nath; Pristine River’s account has been analysed and transfer of funds traced. Account of Tanay Holdings has been attached; Letters Rogatory have been sent in Bakul Nath’s case to Switzerland. For Rajiv Saxena, too, a PMLA case was in progress and properties valued at $2.9 million attached.

Rajiv Saxena is also an accused in the Moser Baer bank fraud case and his foreign properties valued at $49 million were attached, including his personal villa.