The Enforcement Directorate (ED) has sent a show-cause notice to Byju, accusing the company of violating the Foreign Exchange Management Act (FEMA) to the tune of Rs 9,000 crore. According to a report by the Economic Times, the notice has been sent to Byju Raveendaran, founder of Byju’s, and Think and Learn Pvt Ltd.
However, the company also issued a statement and denied receiving any notification. “Byju categorically denies media reports that it has received a notification from the Enforcement Department. The company has not received any such communication from the Enforcement Department,” the statement read.
ED raid in company premises in Karnataka
Under the provisions of the FEMA, the ED conducted searches and seizures at three premises in Bengaluru Karnataka in connection with a case lodged against Raveendaran and his company in April this year. According to officials of the Department of Education, various harmful documents and digital data were seized during the search and seizure procedure.
The ED officials also said that the company received nearly Rs 28,000 crore in foreign direct investment between 2011 and 2023, and during the same period, it repatriated around Rs 9,754 crore to various foreign jurisdictions under the guise of foreign direct investment.
The company had booked nearly Rs 944 crore in marketing and advertising expenses at the time, including the money sent to a foreign jurisdiction, according to Education Department authorities. A corporate representative then denied the allegations, saying the ED visit was related to a standard FEMA investigation and that the company had not violated any FEMA regulations.
What did the company say?
A spokesperson for BJYU’s legal team said the ED action was a “routine investigation” and that the company was “fully transparent with the authorities and provided them with all the information they requested.”
The ED alleged that the company (Think & Learn Pvt Ltd) has not prepared its financial statements from 2020-21 and the accounts have not been audited, which is mandatory. Therefore, the veracity of the figures provided by the company is being questioned by the banks, he said.
(For agency input)
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