ITC $100 MILLION FOREIGN EXCHANGE AND RS.799 CRORE EXCISE-EVASION

FRAUD

Contents

• Introduction Of ITC

• Advent Of Scam

• Details Of The Scam

• FERA Violations

• Excise Evasion Fraud

Introduction Of ITC Founded in 1790 by Henry Overton Wills. Started by the UK-based tobacco major BAT. ITC Limited company headquartered in Kolkata. Headed by Yogesh Chander Deveshwar. Revenues is $6 billion and a market capitalization of over $30

Billion. Started as Imperial Tobacco Company. Initially, it was majorly in the business of cigarette

manufacturing and tobacco procurement. ITC diversified business to other industries such as hotels,

stationery and FMCG products.

Advent Of Scam  Enforcement Directorate(ED) conducted raids on the various establishments of tobacco to hotels major ITC in Kolkata in October 1996.

ITC violated FERA (Foreign Exchange Regulation Act) regulations to the tune of $100 million.

ED, Customs and Department of Revenue Intelligence (DRI) arrested the director and head R. K. Kutty and few more ITC executives for interrogation.

ITC involvement in the Excise Evasion and share manipulation.

Details Of The Scam As per ITC instruction around $83 million was transferred to India.

ITC also manipulate the invoices related to exports.

A sum of $ 6.5 million was transferred from ITC Global to the Chitalias companies.

Over-invoicing of machinery imported by ITC.

ED raided on nearly 40 ITC offices

FERA VIOLATIONS

ILTD transferred $4 million to a Swiss bank account.

ITC also made payments to non-resident shareholders.

ITC under-invoiced exports to the tune of $1.35 million.

ITC transferred funds in an unauthorized manner.

Use of funds retained abroad for personal use by ITC executives.

EXCISE EVASION FRAUD

ITC involvement in the excise evasion fraud of Rs.799 crore.

Penalty of Rs.74 crore. Kept higher effective prices than the maximum

retail prices. The arrests of 2 former chairmen and 8

executive directors.

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