Lawstreet Journal

Flipkart Co- Founder Sachin Bansal Moves Madras High Court Over Ed's Notice Of Rs. 10,600 Crores For Violation Of Fema

Lawstreet Journal 6 Sep 2021 7:18pm

Image courtesy: Lawstreet Journal Business Flipkart Co- Founder Sachin Bansal Moves Madras High Court Over Ed's Notice Of Rs. 10,600 Crores For Violation Of Fema

The co-founder of Flipkart, Sachin Bansal recently approached the Madras High Court over the notice issued by the Enforcement Directorate against the violation of the laws under the Foreign Exchange Management Act, 1999.

BACKGROUND 

A show-cause notice was issued by the Enforcement Directorate on August 5, 2021, against Sachin Bansal and Binny Bansal the co-founders of the E-commerce giant Flipkart.

This step was taken by the Enforcement Directorate as from 2009 to 2014, the now Walmart owned Flipkart had not followed certain conditions as per the Foreign Direct Investment Policy of 2010 while issuing Flipkart Group Companies shares to foreign investors. 

The said notice was issued against the Co-Founder of Flipkart Sachin Bansal and nine other entities/individuals. 

THE ALLEGED VIOLATION 

It is alleged by the Enforcement Directorate that the E-commerce giant and nine others, one of which is based in Singapore, have violated the foreign exchange rules during the period of 2009 to 2014 due to which the anti- money laundering organization issued a show-cause notice against them under the Foreign Exchange Management Act,1999 amounting to INR 10,600 Crores.

Another contention for which the ED has issued the notice is “transfer and issue of security to the person outside India.” 

RESPONSE OF THE ACCUSED 

Sachin Bansal has approached the Madras High Court claiming that the investigation  due to which the notice has been issued dates back to 2012 -13, while the notice is issued after nine years even though they cooperated in the investigation completely.

Furthermore, in his petition,… Continue Reading...


Tagged: Flipkart  
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