ED to issue notices in Wal-Mart investments probe

Tags: ED, Wal-Mart, Retail
The Enforcement Directorate (ED) will soon issue notices to American retail giant Wal-Mart as part of its probe against the company's investment in an Indian firm for alleged violations of forex laws.

"The agency has received a communication from the RBI to probe the investments in this regard. Notices for want of documents with regard to financial investments and remittances will be issued by the Bangalore office of the agency," a source privy to the development said.

The agency, which has registered a case under the Foreign Exchange Management Act (FEMA), will also ask the Commerce and Industry Ministry to furnish it with clearances that were given to the company to route the investment in 2010 in a subsidiary of Bharti ventures via a Mauritian arm, the source said.

The investigations are being conducted to probe allegations that Wal-Mart put money into the domestic multi-brand retail chain despite a ban on foreign direct investment in the sector.

Bharti Enterprises has, however, rejected the allegations that it had violated any rule in this regard. The company had said all the procedures were as per the "law of the land".

The Rs 455.8 crore investment by Wal-Mart in Cedar Support Services Ltd, a subsidiary of Bharti Ventures, had come under attack from CPI Rajya Sabha member M P Achuthan, who wrote to Prime Minister Manmohan Singh earlier, saying it was "illegal" and flouted FDI rules.

The ED, a central investigative agency mandated to probe violations under the FEMA and Prevention of Money Laundering Act (PMLA), was asked by the Reserve Bank of India to check the alleged violations made by the US-based retail giant in an official communication earlier this month.

Post new comment

E-mail ID will not be published
CAPTCHA
This question is for testing whether you are a human visitor and to prevent automated spam submissions.

EDITORIAL OF THE DAY

  • Amidst Sino-Indian bonhomie, the Tibet issue cannot be wished away

    Tibet did not figure in the three-day high-level meetings between India and the People’s Republic of China (PRC).

FC NEWSLETTER

Stay informed on our latest news!

INTERVIEWS

GV Nageswara Rao

MD & CEO, IDBI Federal Life

Timothy Moe

Goldman Sachs

Chander Mohan Sethi

CMD, Reckitt Benckiser India

COLUMNIST

Varun Dutt

<b>Riskfactor</b>: Intertemporal choices

Intertemporal choice is the study of the relative value people ...

Parvez Imam

Why we all have blood on our hands

What does the Jammu and Kashmir flood make us think? ...

Dharmendra Khandal

The peculiar possibilities of animal poop

You can tell a lot about an animal by its ...

INTERVIEWS

William D. Green

Chairman & CEO, Accenture