The directorate of revenue intelligence (DRI) has slapped a showcause notice on infrastructure and trading major Adani Group-owned Adani Exports and its group companies alleging foul play to claim government incentives in exports of studded diamond and gold jewelery. The DRI said the company, consortia led by it and key executives adpoted circular trading and over invoicing exports of studded gold jewelery to avail undue benefits under government?s ?Target Plus Scheme?. This, as per a DRI report for trading period 2004-05, has resulted in illegal release of government funds worth several hundred crores meant for promotion of exports.
This is the second such showcause notice issued to Adani Exports over its alleged fraudulent practices in jewelery export business. In 2007, DRI had slapped a show cause notice to the company and its affiliates for using unfair means to claim export incentives on cut and polished diamond. ?The company has received the show cause notice. We have requested DRI to provide certain documents. Upon receipt of the same, the company will submit its detailed reply,? said a Adani Group spokesperson.
In the latest case, the DRI investigation has revealed that over 80% of the exports in 2004-05 by Adani Exports and its group companies was achieved by way of circular trading of cut and polished diamonds and studded gold jewelery at a overstated value to artificially boost company?s export turnover. This helped the company receive larger benefit under the Target Plus scheme in operation that time to give a leg up to exports. The investigation has also charged the company with only negligible value addition on imported gold to maximize the benefit for companies.