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Paradise Papers: Late Caparo scion took Mauritius route to harness India wind energy

According to Appleby records, BVML is the holding company for Mytrah Energy India Limited (MEIL), incorporated on November 12, 2009 as Caparo Energy India Limited, which changed its name to MEIL on September 27, 2011.

Written by Shyamlal Yadav | New Delhi |
Updated: November 7, 2017 8:29:12 am
Lto R Angad Paul, Akash Paul, Prime Minister John Major Ambar Paul, Swraj Paul and caparo Chief Executive James Leek. Express File photo

Before he fell to his death from a London penthouse on November 8, 2015, Angad Paul, son of UK-based business magnate Lord Swaraj Paul, had taken the Mauritius route to invest in India, primarily in the wind energy sector, according to Appleby records.

In 2010 , four family companies based in the British Virgin Islands — Caparo Energy Capital Inc, Caparo Energy Holdings Inc, Caparo Energy Investments Inc and Esrano Overseas Ltd — formed a holding company Caparo Energy Ltd (CEL), based in Guernsey, which in turn formed a company in Mauritius called Caparo Energy Investments Ltd.

Appleby records show that the words Caparo Energy in the names of three BVI companies were replaced with Bindu Urja. In 2011, Caparo Energy Ltd was renamed Mytrah Energy Limited — MEL is listed at the London Stock Exchange. The Mauritius-based Caparo Energy Investments Ltd was renamed Bindu Vayu Mauritius Ltd (BVML).

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When MEL was listed at the London Stock Exchange, Angad Paul was its Non-Executive Chairman and Ravi Shankar Kailas was Chief Executive Officer. Appleby records show Angad Paul was named PEP (politically exposed person) on November 9, 2015 — the day after his death.

According to Appleby records, BVML is the holding company for Mytrah Energy India Limited (MEIL), incorporated on November 12, 2009 as Caparo Energy India Limited, which changed its name to MEIL on September 27, 2011. The MEIL financial statement for 2015-16 recorded its turnover at Rs 2448.78 crore. The company’s present chairman is Ravi Shankar Kailas and it has 15 subsidiaries in India. MEIL has three step-down subsidiaries.

In Appleby records, a document dated May 24, 2010 states that the business purpose of the company is to be “an investment holding company of an Indian subsidiary which in turn will primarily be used to set up renewable fuel based power generation projects in India”.
Records show that the company will “be owned by Caparo Energy Capital Inc, Caparo Energy Investments Inc and Caparo Energy Holdings Inc”. These companies were incorporated in the British Virgin Islands and Angad Paul, Ravi Kailas and Alastair Cade became ultimate beneficial owners of the BVI companies. According to an Appleby document of September 26, 2014, the BVML is placed “High” in the risk rating of the companies.

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In Appleby records, a note of BVML for financial year 2012-13 states, “Under the current laws and regulations, the Company (BVML) is subject to income tax in Mauritius at the rate of 15 per cent but is entitled to a tax credit for foreign taxes equivalent to the higher of actual foreign tax suffered and 80 per cent of Mauritius tax payable in respect of its foreign source income, thus reducing its maximum effective tax rate to 3 per cent. The Company (BVML) had no tax charge for the year ended March 31, 2013 as it had no taxable income.” There is a similar statement for the financial year 2013-14.

On October 15, 2013, Appleby employee wrote an email to his colleagues: “It is noted that the file consists of a high risk of round tripping and the risk profile of this client continues to be set to be high… Ravi Kailas is a B.O. of BVML (through Bindu Urja Capital Inc). Noted from the provided proof of address that his current permanent residential address is in India. However, also noted from professional reference letter from Gabhawala Chartered Accountants that Ravi Kailas is an NRI, residing in Canada.”

Referring to a loan from Infrastructure Development Finance Corporation (IDFC), Appleby recorded: “Also noted from an Option Agreement, that IDFC would also be exercising an option of 26 per cent on BVML. The probability of round tripping is very high given that IDFC (an Indian company) has issued capital to CEIL (Indian company) in exchange of shares pledged in MEL (holding company of BVML) and BVML.”


R Somasundaram, Head, Strategic Affairs, Mytrah Energy Limited, Hyderabad, responds on behalf of Ravi Kailas:

Due to the tax treaty between India and Mauritius at that point in time, it was the preferred investment route for thousands of corporates, financial institutions, private equity funds and other business entities. All our companies have been duly incorporated in their respective jurisdictions as per applicable laws as well as duly registered/declared in India with RBI as well as tax authorities.

EXPLAINED: Why the Paradise Papers matter

We are not aware of such a categorisation (of high risk by Appleby). We are not privy to the document you are referring to. We can more meaningfully comment if you can make available this document in your possession. We have had several loans from IDFC. Some of the loans are fully repaid and the rest are being serviced as per schedule.

We have changed the names of three of our companies once. Caparo Energy Limited was changed to Mytrah Energy Limited (MEL), Caparo Energy Investment Limited Mauritius was changed to Bindu Vayu Mauritius Limited (BVML) and Caparo Energy India Limited was changed to Mytrah Energy India Limited (MEIL). All the three name changes were done at the same time pursuant to the decision to establish the Mytrah brand as a common brand and also to avoid confusion and correlation with the Caparo Group. All the name changes were duly notified to all the regulatory authorities in respective jurisdictions including re-registration where necessary. Mr Ravi Kailas continues to be Director in BVML and Chairman of MEIL. There are no relations with late Angad Paul apart from their initial holding in the company through their family trust.

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