An inflow of over Rs 7,300 crore into 26 companies, most of them registered at two Delhi addresses, from companies registered in Mauritius and Cyprus has caught the attention of tax slueths. Sensing that this could be a case of “round-tripping” – money that was clandestinely salted away abroad finding its way back – the income tax (I-T) department has approached the Mauritius and Cyprus governments for ownership details of the investor companies.

Taxmen have established that all the investments through the Mauritius route have come from one address in Port Louis: 7th Floor, Happy World House.

Of the 26 recipient companies, eight are registered at A-11, First Floor, Niti Bagh, while another seven are registered at 3rd Floor, Kanchan House, Karampura, in the capital.

Investigations have revealed that the 15 companies listed at the two New Delhi addresses, which received around Rs 5,200 crore, are part of IREO, a fast-growing real estate group, which I-T officials allege is linked to BJP leader Sudhanshu Mittal. On October 19, the I-T department had raided these 26 recipient companies, but the raids were seen as linked to Commonwealth Games contracts. It now transpires they were conducted because of this huge funds inflow into them.
Lalit Goyal, who is the managing director of the IREO group, is Sudhanshu Mittal’s brother-in-law. At the time of the October raids, Mittal had protested saying he was being targeted for being a member of the BJP. When contacted by TOI, Sudhanshu Mittal denied he had any connection with any of the companies. He alleged that a conspiracy had been hatched to malign him and his party.

Interestingly though, he dismissed all allegations against the group even as he denied having anything to do with IREO.

“Although I carry no brief for the company, all investments in it are transparent and have come through private equity funds which have declared ownerships,” he said. He stressed that neither he nor Lalit Goyal had equity in any of the IREO companies.

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Goyal told the newspapers that there had been no violation of FDI rules by any of his group companies. IREO was a private equity fund with investors based in different continents, he said.
“They include university endowment funds and globally known financial institutions and sovereign funds. We have office in Mauritius with at least 30 officials working there and there is absolutely nothing wrong if all the group companies are managed from one single office.”
“As far as our investors is concerned, when the I-T had done a survey two years ago, we had provided them a partial list of investors with investments details worth Rs 3,000-4,000 crore,” Goyal said.

“Our Indian operations are run from our Gurgaon office and the Niti Bagh and Karampura addresses are that of our lawyer and chartered accountant, respectively, and since group companies were incorporated on these addresses they still remain.”Investors had not withdrawn any money because of the three-year lockin period for foreign direct investment, he added.

More cos on radar

A s the investigators await the response of the authorities in Mauritius and Cyprus on IREO, they are also looking at similarly large money inflows into certain aviation companies.

I-T writes to govts of Cyprus and Mauritius for details of money flows from those countries

15 of the recipient companies are listed at two addresses in Delhi

All Mauritius funds are from one address in Port Louis: 7th Floor, Happy World House

Sudhanshu Mittal, whose brother-in-law Lalit Goyal is MD of IREO, tells  he’s being targeted for his political affiliation

Goyal says both sources of funds and offices are legitimate

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