Maharashtra: ED probes Jadhavs' Dubai firm for FEMA violations

The Law Enforcement Directorate (ED) is investigating a Dubai company owned by the family of former Shiv Sena corporal Yashwant Jadhav, which was formed in 2018, the same year he became chairman of BMC’s standing committee, for allegedly violating the rules of the Foreign Exchange Management Act (FEMA).

Around Rs 5 crore was deposited into the company’s account in Dubai, half of it in cash, during the pandemic.

ED had summoned Jadhav and his two sons on Tuesday. While Jadhav did not show up, one of his sons recorded his statement. ED will be issuing a new summons to Jadhav soon.

The Dubai-registered company, Synergy Ventures (FZC), was owned by Jadhav’s sons and was shut down after the Income Tax (Investigation) Wing launched an investigation into its financial dealings last year.

 During interrogation, Jadhav’s son told officers that his father was minding company business. The ED and IT wing suspect that Rs 5 crore was generated in Mumbai through illegal means by Jadhav during his tenure as Chairman of BMC Standing Committee and was diverted to Dubai mainly through hawala channel and deposited in Synergy Ventures . 

ED is also investigating the Rs 70 lakh that Jadhav allegedly paid to two people (Rs 35 lakh each) in the US and Canada via hawala for handing over the rental rights of their apartments to Byculla’s Bilakadi Chambers, a pagdi system building , to Newshawk Multimedia, a company controlled by him.

Jadhav was elected a corporal in 2017 and became chairman of the BMC standing committee the following year. This committee is the final authority for approving major financial proposals within the civic body. The BMC spends around Rs 12,000 crore every year on civic works which they execute through private contractors.
Sources said that Synergy Ventures (FZC) was established in 2018 and some of the money was diverted to it through legal channels through fictitious transactions. Later, more money was diverted to him from Hong Kong.

 Between 2020 and 2021, huge local currency cash (equivalent to more than Rs 2 crore) was deposited into his account. The Jadhavs claimed it was income from their consultancy business, but IT and emergency managers found the amount suspicious.
When IT launched an investigation into the shell company controlled by Jadhav, Pradhan Dealers, he liquidated Synergy Ventures and brought its profits back to India through legal channels, showing the company’s profits. 

The Registrar of Companies recently filed a written complaint with Marine Drive Police seeking the registration of a case of cheating and criminal conspiracy against Pradhan Dealers and its directors. Police said they would file the FIR after investigating the allegation.