Bhopal, March 19 – The Enforcement Directorate's (ED) Bhopal Zonal Office conducted searches and seized assets at three premises linked to M/s Rajul Group and its partner, Priyank Mehta, in Jabalpur, Madhya Pradesh, on Thursday.
The action, conducted under the provisions of the Foreign Exchange Management Act (FEMA), 1999, is related to the alleged misuse of the Liberalised Remittance Scheme (LRS) for acquiring foreign property.
The investigation was initiated following inputs from the Income Tax Department.
During a search of Rajul Group in September 2023, tax officials reportedly found evidence suggesting that Mehta possessed foreign assets.
Further inquiries revealed that he had purchased a residential flat in Lisbon, the capital of Portugal, for €510,000 and was earning rental income from the property.
Authorities noted that these foreign investments and income were not disclosed in the Foreign Assets Schedule of his income tax returns, according to a press statement issued by the ED on Thursday.
The ED's latest operation resulted in the seizure of unaccounted cash worth ₹31 lakh from Mehta's premises.
Investigators also traced fund transfers amounting to $548,000 to the US under the LRS scheme, which were subsequently routed to Portugal.
In addition, €4,209,980 (equivalent to ₹3.65 crore) were transferred to Portugal and used to purchase the flat in Lisbon.
Officials said that approximately ₹2.1 crore remains in Mehta's bank account in Portugal, the central agency said.
The central agency suspects that these transactions were structured to circumvent disclosure norms and conceal foreign assets.
The case highlights growing concerns over the misuse of the LRS framework, which allows resident individuals to remit up to $250,000 per financial year for permissible current or capital account transactions, including overseas property purchases.
While the ED has not yet disclosed whether further arrests are imminent, officials confirmed that a detailed investigation is underway to establish the full extent of violations and identify possible money laundering angles.
The seizure of cash and documentation marks a significant step in the probe, which could have wider implications for compliance with FEMA and the Income Tax Act.