The Enforcement Directorate (ED) on Tuesday said it has seized shares worth Rs 293.91 crore of former Tamil Nadu Mercantile Bank Limited Chairman Nesamanimaran Muthu in connection with a probe against him linked to alleged contravention of the FEMA law. The seized assets are in the form of shareholdings of Muthu alias MGM Maran in four Indian companies: Southern Agrifurane Industries Private Limited, Anand Transport Private Limited, MGM Entertainment Private Limited and MGM Diamond Beach Resorts Private Limited.
The agency said in a statement that Muthu had incorporated two companies in Singapore during 2005-06 and 2006-07 financial years and invested SGD 5,29,86,250 (equivalent to Rs 293.91 crore). "This investment was made without taking approval from the RBI. Further, the source of such a huge investment abroad was not disclosed to the Indian regulators," the agency said.
Section 37A(1) of the Foreign Exchange Management Act (FEMA) empowers the ED to seize domestic assets of a person who has acquired properties in a foreign country or made investment outside India without the approval of the RBI while he was a Indian resident. "Since, the amount of foreign investment was SGD 5,29,86,250, the assets of equivalent value thereof of Rs 293.91 crore have been seized," it said.
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