The Enforcement Directorate has attached three immovable properties worth Rs 24.95 crore of Hero MotoCorp executive chairperson Pawan Kant Munjal as part of the ongoing money laundering probe, the federal agency said on Friday.
Munjal has been accused of using foreign currency issued in the name of others for his personal expenditure abroad to “override” RBI rules.
It claimed that the foreign currency/foreign exchange was drawn from authorised dealers by an event management company in the name of various employees and thereafter “handed over” to Munjal’s relationship manager.
“The relationship manager carried such foreign currency/foreign exchange in cash/card secretly, for the personal expenditure of Pawan Kant Munjal during his personal/business trips. The modus was adopted to override the limits of $2.5 lakh per annum per person under the Liberalised Remittance Scheme (LRS),” the ED alleged.
The ED said that the total value of seizure and attachments now stands approximately at Rs 50 crore. “The prosecution complaint alleges that foreign currency/foreign exchange equivalent to Rs 54 crore was illegally taken out of India,” the ED said.
The Delhi High Court, in an order issued on November 3, stayed proceedings of the DRI, on which the ED case is based.
In an interim order, the high court noted that Munjal has been exonerated by the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) on the same set of facts and this was not disclosed before the trial court and that the petitioner has been able to make out a case for interim protection.
A First Information Report (FIR) was filed in October on a complaint alleging forgery, falsification of accounts, criminal conspiracy, and cheating by certain officials of Hero MotoCorp.
The FIR named Pawan Munjal, and Hero MotoCorp executives Vikram Kasbekar and Hari Gupta.
However, the company said in a statement on the exchanges that this case is an old matter and pertained to the year 2009-10 with a disgruntled service provider, Brains Logistics, a former vendor of Hero Honda Company, alleged that the accused colluded to and committed “the illegal acts of forgery, cheating and falsifying the books…and manufactured fake month-wise bills”. These bills, totalling Rs 5.95 crore for 2009 and 2010 were debited to the complainant, it alleged.
Separately, in August this year, the ED had conducted searches on Munjal and some others as part of an investigation into an alleged money laundering case.
The searches were carried out at the residential and business premises of Munjal in Delhi and Gurgaon, and some linked entities.
In a statement, the company had at the time said, “Officials from the Enforcement Directorate (ED) today visited two of our offices in Delhi and Gurugram and the residence of our executive chairman Dr Pawan Munjal. We continue to extend all cooperation to the agency.”
The case registered by ED originated from a complaint filed against Munjal by the Directorate of Revenue Intelligence (DRI), the investigation branch of the Central Board of Indirect Taxes and Customs (CBIC).