ED Probe Finds Missing Documents, Discrepancies at Rajesh Exports – ₹1,035 Crore Africa Investment Unverified

The Enforcement Directorate (ED) has uncovered multiple irregularities at Rajesh Exports Ltd, including missing records of foreign transactions, a ₹1,035-crore investment in African mines without supporting documents, and a 40% gap between physical gold stocks and those recorded in company registers. These preliminary findings emerged from search and seizure operations at nine premises linked to the gold exporter in Bengaluru and Mumbai under the Foreign Exchange Management Act (FEMA), 1999.

According to an ED statement issued Wednesday, the investigation into the company’s overseas transactions, stock holdings, and share dealings has revealed several suspected contraventions. The agency questioned the remuneration structure of key managerial personnel, noting that the Chief Financial Officer (CFO) has not drawn a salary since 2020, while the Managing Director received only about ₹17,000 per month—despite the company reporting consolidated revenues of approximately ₹7.7 lakh crore.

The ED said the company failed to produce documentation for foreign transactions, including imports, exports, overseas investments, and settlement of trade receivables and payables. “The company failed to produce documentation in respect of its foreign transactions… thereby rendering verification of the genuineness of such transactions almost impossible,” the agency stated.

As an example, the ED cited a purported ₹1,035-crore investment in African mining assets, for which no contemporaneous records or supporting documents were found or provided. The agency also flagged opaque adjustments of foreign trade receivables and payables amounting to around ₹3,000 crore, involving entities in the UAE and other jurisdictions now under scrutiny.

Physical verification of inventory revealed a significant discrepancy: the actual gold stock at company premises was approximately 40% lower than the amount recorded in factory records. Additionally, the investigation uncovered suspicious block trades in the company’s shares. The ED alleged that more than ₹600 crore was siphoned out of India through share-manipulation transactions using NRI benamidars (proxy holders). Some individuals involved in these trades appear in disclosures and leaks released by the International Consortium of Investigative Journalists (ICIJ), indicating possible undisclosed offshore links.

Queries emailed by The Indian Express to Rajesh Exports on Wednesday did not elicit any response. The latest findings add to the regulatory scrutiny facing the company after the Securities and Exchange Board of India (SEBI) last week alleged that Rajesh Exports overstated revenues by approximately ₹15.15 lakh crore between FY21 and FY25. SEBI subsequently barred promoter-chairman Rajesh Mehta and the company from accessing the securities market pending further investigation.