The Enforcement Directorate (ED) has seized ₹1.39 crore in unaccounted cash and several incriminating documents during a search operation across nine locations in Odisha, Delhi, and Gurugram. The operation, conducted on November 22, 2024, was carried out under the Foreign Exchange Management Act (FEMA), 1999, targeting Z Estates Private Limited (ZEPL), a prominent Odisha-based real estate firm.
Details of the Raid
The ED took to social media platform X to confirm the searches, stating:
“ED, Bhubaneswar has conducted search operations at 09 locations in Odisha, Delhi, and Gurugram under the provisions of FEMA, 1999 on 22.11.2024 in connection with an investigation being carried out against M/s Z Estates Private Limited (ZEPL) & others.”
The agency focused on tracing the sources of income, transaction origins, and forex transfer links during the operation.
What Was Seized?
The searches led to:
- ₹1.39 crore in cash, suspected to be unaccounted for.
- Various incriminating documents related to financial transactions and potential FEMA violations.
Z Estates’ Response
A day after the operation, Tapan Mohanty, Managing Director of Z Estates, issued a statement to clarify the situation:
- He asserted that the searches were routine checks by the ED and not raids.
- Claimed that only 3-4 premises were searched, contrary to the ED’s statement of nine locations.
- Emphasized that Z Estates regularly receives foreign investments and the ED was verifying compliance with regulations.
- Stated, “No incriminating documents were found during the operation. The ED officials are doing their job, and we have cooperated fully.”
Implications of the ED Operation
The ED’s actions have brought Z Estates under scrutiny, raising questions about:
- Potential irregularities in foreign investments received by the company.
- The origins of the unaccounted cash seized during the operation.
While the MD has denied any wrongdoing, the ED’s ongoing investigation may uncover further details about compliance lapses or financial misconduct.
Context: Rising Scrutiny in Odisha’s Real Estate Sector
This search follows a trend of increasing regulatory scrutiny on the real estate sector in Odisha, which has witnessed a surge in foreign direct investments (FDI) and luxury property developments. The ED’s actions reflect a broader effort to curb potential violations under FEMA and ensure transparency in financial transactions involving foreign exchanges.
As the investigation progresses, the case of Z Estates will remain a focal point, potentially setting a precedent for other firms in the sector.
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