NEW DELHI: The Enforcement Directorate (ED) conducted search operations on October 4 at seven premises across Nagaland, Assam, and Tamil Nadu in connection with an export business of human hair to Tunisia and Italy, the agency said on Thursday, citing violations of the Foreign Exchange Management Act (FEMA), 1999.
The agency received information that Imsong Global Suppliers Co., based in Nagaland and claiming to be engaged in the export of human hair to entities in Tunisia and Italy, received foreign remittances amounting to Rs 50 crore under suspicious circumstances. During the searches, crucial evidence, documents, and digital devices relating to the foreign remittances received by Imsong Global Suppliers Co. were seized.
The company, despite a considerable lapse of time, had failed to submit the requisite export documentation, such as shipping bills and export invoice copies, to the authorized dealer bank within the prescribed timelines. “Such non-compliance with export obligations and suppression of documentary evidence constitutes contraventions of the provisions of FEMA, in violation of several directions issued by the RBI from time to time,” the agency stated.
During the investigation, it was found that the foreign remittances received by Imsong Global Suppliers Co. were further diverted to Inchem India Private Limited under the pretext of purchasing human hair. The agency discovered that Inchem India Private Limited, which had remained dormant or inactive for a considerable period, was reactivated in 2015. This coincides precisely with the period when Imsong Global Suppliers Co. began receiving large foreign remittances.
The funds received in the bank accounts of Inchem India Private Limited were further diverted to companies based in Chennai engaged in the trading of human hair, followed by immediate debits. However, the authenticity of purchases of human hair from these Chennai-based entities by Inchem India Private Limited could not be established. Consequently, the genuineness of purchases of human hair by Imsong Global Suppliers Co. and the corresponding exports also could not be verified.
Furthermore, the timing of the revival of Inchem India, coinciding with the inflow of foreign funds to Imsong Global Suppliers Co., strongly suggests that the sole purpose of reviving the company was to provide a conduit for diverting funds received under the guise of exports.
During the probe, one of the directors of Inchem India Private Limited stated that he was not aware of the activities carried out by the company and was only receiving remuneration for lending his name as a director of the company.