The Enforcement Directorate (ED) on Monday attached three immovable properties in Mumbai belonging to Serum Institute of India co-founder Zaware Soli Poonawalla under provisions of the Foreign Exchange Management Act (FEMA).
The ED is probing a case of misuse of the Liberalized Remittance Scheme (LRS) under provisions of FEMA against Mr Poonawalla and his family. According to the agency, “Mr. Poonawalla’s name was found in the Panama Papers disclosure about offshore entities. Investigation revealed that Mr. Poonawalla and his family members had remitted foreign exchange abroad by misusing the provisions of the LRS scheme. He utilized the maximum permissible limit and from the year 2011-12 onwards, he remitted money abroad through false declarations on the pretext of ‘family maintenance and self-maintenance’ etc., though no member of his family was living abroad or NRI was not in position.
The entire amount remitted by Mr. Poonawalla and his family members under the LRS was invested in the British Virgin Islands-based Stalast Limited to purchase four apartments in Paddington, London.
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The ED’s press release said, “Multiple FEMA violations were observed in these transactions. In addition to mis-declarations in remittances, Mr. Poonawalla and his family members wrongly claimed these investments as foreign portfolio investments, but In fact, the foreign entity was completely controlled by them and thus, they made foreign direct investment in a foreign wholly owned subsidiary without due permission from the Reserve Bank of India. The foreign assets were not declared to RBI. They are today Till date remained above foreign wealth and continued to enjoy the same.
“Properties abroad were acquired through funds remitted under LRS to avoid reporting requirements to RBI and thus, Mr. Poonawalla has misused LRS. Therefore, three properties at Seajay House, Worli, Mumbai having an equivalent value of Rs 41.64 crore held by him and his family members have been confiscated,” the press release said.