Business: ED raids Hero MotoCorp chief Pawan Munjal’s residence, offices
Virendra Pandit
New Delhi: In one of the highest profile corporate raids, the Enforcement Directorate (ED) on Tuesday swooped at the residence and offices of Hero MotoCorp’s Executive Chairman Pawan Munjal in the national capital to conduct a search and investigate a case of alleged diversion of funds.
The raid came on the heels of an investigation ordered by the Ministry of Corporate Affairs to assess Hero MotoCorp’s relationship with a third-party vendor in a case related to the alleged diversion of funds, the media reported.
The government’s financial crime-fighting agency took cognizance of a Directorate of Revenue Intelligence (DRI) case and registered a case against Munjal under the Prevention of Money Laundering Act (PMLA), the reports said.
The ED officials also visited the company’s premises based in Delhi and Gurugram, it said in a regulatory filing.
“Officials from the Enforcement Directorate today visited two of our offices in Delhi and Gurugram and the residence of our Executive Chairman Dr. Pawan Munjal. We continue to extend all cooperation to the agency,” Hero MotoCorp informed the stock exchanges.
The investigation stemmed from a DRI complaint against a person, allegedly close to Munjal, who was investigated on charges of carrying undeclared foreign currency. In June 2023, the Ministry of Corporate Affairs launched a probe to evaluate the association between the company and this third-party vendor in a case related to the alleged diversion of funds.
Shares of Hero MotoCorp fell over 4 percent, trading at a year’s low of Rs 3,064, following the news of the ED raid. The scrip settled at Rs 3,103 apiece on the BSE at the close of the market hours, which was 3.14 percent lower than the previous day.
Hero MotoCorp, India’s largest manufacturer of motorcycles since 2001 in terms of volume sales in a calendar year, was under the scrutiny of Income Tax authorities in 2022 also, but the company had termed it as a “routine inquiry.”
In March 2022, the IT officials raided Munjal and his company as part of an investigation into tax evasion.
The company has a presence across 40 countries spanning Asia, Africa, and South and Central America.
