ED files complaint against Myntra and its directors for alleged FEMA offences worth over ₹1,645 crore
In an official release, the ED said its probe was based on what the agency called credible information that Myntra and its related companies allegedly conducted Multi Brand Retail Trade (MBRT) under the guise of 'Wholesale Cash & Carry', which violates the extant Foreign Direct Investment (FDI) policy.
According to the release, the ED investigation under provisions of FEMA, found that Myntra Designs had declared engagement in the wholesale cash and carry business, and thus and invited and received FDI from foreign investors equivalent to ₹ 1,654.35 crore.
'… that they sold majority of their goods to Vector E-Commerce (who sold the goods in retail to the ultimate customer). That Vector and Myntra re related parties and belong to same group or group of companies. Vector e-commerce was created and continued to be used as corporate entity to bifurcate the B2C (retail business) transaction into B2B (between companies) and then B2C (Vector to retail customers),' it detailed.
It added that probe found Myntra 'carried out multi-brand retail trading in the guise of wholesale cash and carry, and did not satisfy conditions laid down for 'Wholesale/Cash & Carry Trading' as they have made cent per cent sales to Vector — which is in contravention of amendment dated April 1, 2010 and October 1, 2010, which permitted only 25 per cent sale to companies belonging to the same group or group companies'.
The ED release claimed that the Flipkart group-owned Myntra and others 'have contravened provisions as per section 6(3)(b) of FEMA 1999 and consolidated FDI policy dated April 1, 2010 and consolidated FDI policy dated October 1, 2010 to the tune of ₹ 1,654 crore'.
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Fibre2Fashion
an hour ago
- Fibre2Fashion
Vietnam's FDI up 27.3% YoY in Jan-Jul; outward investment up over 200%
Vietnam attracted $24.09 billion in foreign direct investment (FDI) in the first seven months this year—a 27.3 per cent year-on-year (YoY) rise—driven by strong investor confidence, according to the ministry of finance's National Statistics Office (NSO). The inflows, covering newly-registered and adjusted capital and capital contribution through share purchases, included $10.03 billion registered for 2,254 new projects. The figures presented a YoY rise of 15.2 per cent in projects, though registered capital dropped 11.1 per cent, a domestic news agency reported. Vietnam attracted $24.09 billion in FDI in January-July 2025â€'a 27.3 per cent YoY riseâ€'driven by strong investor confidence. Manufacturing and processing accounted for 55.9 per cent of the newly-registered capital. Singapore led among 74 nations and territories, pouring in $2.84 billion, or 28.3 per cent of the new capital. Outward investment rose by over 200 per cent to $398.9 million during the period. Manufacturing and processing accounted for 55.9 per cent ($5.61 billion) of the newly-registered capital, while real estate's share was 23.5 per cent ($2.36 billion). Singapore led among 74 countries and territories, pouring in $2.84 billion, or 28.3 per cent of the new capital. China followed with 42.27 billion, Sweden added $1 billion, and traditional partners like Japan, Taiwan, and Hong Kong also kept the cash flowing. Combining new and adjusted-capital, manufacturing and processing ruled with $12.12 billion, or 60.6 per cent of the total FDI, followed by real estate at $4.95 billion, equivalent to 24.7 per cent. Share purchases and capital contributions jumped 61 per cent YoY to $4.07 billion via 1,982 transactions, targeting manufacturing (39.3 per cent) and professional, scientific, and technological activities (20.3 per cent). The country disbursed $13.6 billion in FDI, up by 8.4 per cent and marking the biggest seven-month sum in five years. Vietnam's outward investment rose by over 200 per cent to $398.9 million during the period. Total overseas investment, including newly-registered and adjusted capital, hit $528.5 million, a 3.5-fold leap YoY. Laos was the biggest recipient of Vietnamese investment, attracting $150.3 million (28.4 per cent), followed by the Philippines and Indonesia. Fibre2Fashion News Desk (DS)
Hindustan Times
an hour ago
- Hindustan Times
ED seizes funds from 2022 Mangaluru blast accused
New Delhi:The Enforcement Directorate (ED) on Wednesday said that it has attached funds worth ₹29,176 kept in the bank account of an accused in the ISIS-inspired 2022 Mangaluru cooker bomb blast case. The Enforcement Directorate on Wednesday said that it has attached funds worth ₹ 29,176 kept in the bank account of an accused in the 2022 Mangaluru bomb blast case. (HT PHOTO) The blast took place in an auto rickshaw on the outskirts of Mangaluru on November 19, 2022. The man who was allegedly handling the explosives in the three-wheeler, identified as Mohammed Shariq, was injured and named as the main accused in the case. The bomb was supposed to be planted at the Dharmasthala Manjunatha Swamy Temple in Mangaluru. However, it exploded in the auto rickshaw as the timer was set at 09 seconds instead of 90 minutes, the federal probe agency said in a statement. Earlier, the ED had filed a case under the Prevention of Money Laundering Act (PMLA) in November 2022, taking cognisance of a National Investigation Agency (NIA) probe in the matter. The agency said in a statement that a 'bank deposit of ₹29,176 kept in the bank account of another accused named Syed Yasin has been provisionally attached under the PMLA through an order issued by the Bengaluru office of the ED on August 5'. A chargesheet filed in the case by the NIA said that the blast was part of a plan of the banned terrorist group ISIS to spread terror, wage war against the Government of India and to threaten the integrity and sovereignty of India. The agency said an online ISIS handler named 'Colonel' had given training over Wickr app/Telegram etc to Shariq alias Premraj and some other accused to prepare an improvised explosive device (IED). 'He (Colonel) also arranged funds through certain mule (illegal) accounts and also through cryptocurrencies, which were encashed by Yasin and Shariq through PoS (point of sale) agents,' the agency said. In some instances, the ED said, the encashed cryptocurrencies were routed through 'fraudulently opened mule accounts in FINO Payments Bank'. 'Funds worth ₹2,86,008 were deposited by different cryptocurrency dealers in the mule accounts and ₹41,680 was collected in cash. The amount was utilised for the purchase of some goods online to assemble the IED and for hiring hideouts in Mysuru and other places and also for conducting reconnaissance at various places in Tamil Nadu, Kerala and Karnataka,' ED said. The ED said another accused in the case, Maaz Munir, was the person who provided the details of the FINO payments bank mule accounts to Shariq so that he could receive payments sent by the online handler, Colonel.
Indian Express
2 hours ago
- Indian Express
Loan fraud case: ED investigation against Anil Ambani
Five years after he was questioned in the Yes Bank loan fraud case, industrialist Anil Ambani is once again under the scrutiny of investigative agencies. On July 24, the Enforcement Directorate (ED) raided premises linked to his companies in connection with a Rs 17,000 crore alleged money laundering investigation. Anil Ambani appeared before ED investigators on Tuesday. The ED action came some days after the State Bank of India classified the loan account of one of his companies as fraudulent, and markets regulator Securities and Exchange Board of India (SEBI) issued an order detailing a systematic diversion of funds. The investigation flows from FIRs registered earlier by the CBI and inputs from institutions including SEBI, National Housing Bank (NHB), and Bank of Baroda, and covers several Reliance Anil Dhirubhai Ambani Group companies including Reliance Infrastructure, Reliance Power, Reliance Communications, and Reliance Home Finance Ltd (RHFL). The ED suspects a scheme of loan fraud and diversion of funds involving thousands of crores. Loans extended by RHFL and Reliance Commercial Finance Ltd were allegedly routed to group companies and shell firms, bypassing norms and creating a false impression of loan performance through evergreening. According to the preliminary investigation: * A Rs 3,000 crore loan from Yes Bank (2017-19) was allegedly diverted soon after disbursal. In some cases, the loan was sanctioned before due diligence, and backdated documentation was used. * Loans were allegedly onward lent on the day of sanction, often to firms with common addresses and directors. * 'C Company', an undisclosed related party, was used to route funds without disclosure. Reliance Infrastructure allegedly diverted Rs 10,000 crore in this way. * The group allegedly took a haircut of Rs 5,480 crore, receiving only Rs 4 crore in cash and the rest in inactive power distribution companies, with no chance of recovery. The July 24 searches covered 35 premises, including 50 companies and 25 individuals, including senior Reliance Group officials. On August 5, Anil Ambani is learnt to have told the ED that he had no knowledge of several of the alleged fraudulent transactions and loan disbursals, and asked for a week's time to verify the details. The agency has written to a dozen banks including SBI, Axis Bank, ICICI Bank, and HDFC Bank, asking for details of due diligence on loans sanctioned to his companies, including RHFL and Reliance Communications. On August 4, Partha Sarathi Biswal, managing director of Biswal Tradelink Pvt Ltd (BTPL), was arrested for allegedly arranging fake bank guarantees worth Rs 68.2 crore that were provided by Reliance Power for a Solar Energy Corporation of India (SECI) tender. The ED is also examining the role of Yes Bank officials and probing possible quid pro quo. Under the scanner is a Rs 2,850 crore investment by Reliance Mutual Fund in AT-1 bonds of Yes Bank. On June 13, SBI, in accordance with the Reserve Bank of India's directions on fraud risk management, classified Reliance Communications, along with promoter director Anil Ambani, as 'fraud'. The bank is in the process of lodging a complaint with the CBI. SBI's credit exposure in RCom includes fund-based principal outstanding amount of Rs 2,227.64 crore along with accrued interest and expenses with effect from August 26, 2016, and non-fund-based bank guarantee of Rs 786.52 crore. The loan was declared fraudulent on the ground that the company had used the funds in violation of 'agreed terms', and due to 'irregularities observed in the conduct of the account of Reliance Communications'. RCom has said that it is undergoing a corporate insolvency resolution process, and has earlier reported outstanding debt of Rs 40,400 crore. The company has said that the loans referred to by SBI pertain to the period before the insolvency resolution process, and are required to be resolved through the process. In a strong order earlier this year, SEBI laid out how RHFL and its key executives, including Anil Ambani, allegedly orchestrated a fraud on public investors and shareholders. * Rs 12,487 crore in loans were disbursed to 47 shell companies (Potentially Indirectly Linked Entities) between FY17 and FY19. * Many of these companies shared common addresses, directors, or email domains with Anil Ambani group firms. * Deviations from credit policies were routine: loans disbursed on the day of application, backdated sanction memos, incomplete documentation, no security creation. * Loans were allegedly routed to repay earlier loans — an evergreening loop that misrepresented financial health. * A forensic audit by Grant Thornton found that in many cases, the funds ended up back with group companies like Reliance Capital, Reliance Infra, and Reliance Big Entertainment. * SEBI said the GPCL (General Purpose Corporate Loan) scheme was a facade for diversion. It restrained Anil Ambani and top company executives from accessing the securities market, pending further proceedings. The developments have come as Anil Ambani was trying to rebuild after years of financial and reputational setbacks. His troubles began soon after the high-profile split with brother Mukesh Ambani. Companies such as Reliance Communications, Reliance Capital, and Reliance Power collapsed under financial strain — RCom shut down operations in 2019 with liabilities exceeding Rs 46,000 crore. The downfall was marked by defaults, insolvency proceedings, and regulatory actions, including a five-year SEBI ban on Anil Ambani for allegedly orchestrating a scheme to siphon off funds. His troubles extended to defence and infrastructure ventures. Reliance Naval failed to deliver key defence contracts and entered bankruptcy. Other high-profile ventures like Dassault Reliance Aerospace played only modest roles in India's defence sector. Anil Ambani stepped down from several board positions, and group assets were either sold or restructured through insolvency proceedings. A slow turnaround began in 2022. The group pivoted to clean energy, infrastructure, and defence manufacturing. Reliance Power achieved zero debt, and new defence partnerships were forged with European companies. —With inputs from Mahender Singh Manral
