ED slaps Rs 660-cr notice on Videocon for forex violations
15 Nov 2014 10:38 PM GMT
Enforcement Directorate (ED) has issued a Rs 660 crore showcause notice to consumer electronics major Videocon Group on charges of violation of foreign exchange laws.
The notice, under provisions of the Foreign Exchange Management Act (FEMA), has been issued by the Mumbai office of the agency after its probe found that the group has ‘contravened’ the law as it failed to comply with RBI norms by not declaring funds generated by some wholly owned subsidiaries the group had raised overseas few years back, according to ED sources.
‘The group has been charged under section 6 (3) of FEMA which talks about transfer or issue of any foreign security by a person resident in India. The show cause notice has said that the violation done by the group is worth Rs 660 crore,’ they said.
When contacted, Videocon Group Chairman Venugopal Dhoot said that they have ‘not yet
received any notice in this regard so far.’
He, however, said the matter could be related to ‘non-submission of quarterly returns and there would be no monetary penalty to the company. Also, FEMA violation is not a criminal offence.’
The notice, under provisions of the Foreign Exchange Management Act (FEMA), has been issued by the Mumbai office of the agency after its probe found that the group has ‘contravened’ the law as it failed to comply with RBI norms by not declaring funds generated by some wholly owned subsidiaries the group had raised overseas few years back, according to ED sources.
‘The group has been charged under section 6 (3) of FEMA which talks about transfer or issue of any foreign security by a person resident in India. The show cause notice has said that the violation done by the group is worth Rs 660 crore,’ they said.
When contacted, Videocon Group Chairman Venugopal Dhoot said that they have ‘not yet
received any notice in this regard so far.’
He, however, said the matter could be related to ‘non-submission of quarterly returns and there would be no monetary penalty to the company. Also, FEMA violation is not a criminal offence.’
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