ED raids Chennai gold trader in multi-city operation

In a country-wide operation, including in Chennai, against jewellers associated with an alleged gold-smuggling hawala racket, the Enforcement Directorate (ED) seized unaccounted cash of Rs 3.75 crore and more than 39 kg of gold and silver, the probe agency said on Monday. The electronic and digital devices that were seized during the raids are yet to be checked, it said, adding that they may provide more details on the suspected illegal dealings.

The raids were conducted at locations in Chennai, Jaipur and Kolkata under the provisions of the Foreign Exchange Management Act (FEMA). The Directorate said the searches have led to the detection of “huge evasion” of customs duty, GST and Income Tax.

“The ED received reliable input that Maharaja Jewellers (proprietor Tara Chand Soni), Bhagwati Jewellers (owner Ram Gopal Soni) and Ladiwala Associates (owner Honey Ladiwala) of Jaipur were purchasing smuggled gold bars from Harsh Bothra of Chennai and Banka Bullions Pvt. Ltd etc.,” the agency saidin a statement.

Acting on the information, the agency found that various individuals were involved in smuggling of gold bars. They subsequently dispatched them to Jaipur. Gold bars were mainly arriving in Jaipur via Kolkata, it said, adding that the gold was of high purity level.

The suspects used to remove the foreign mark of manufacturer or bank engraved or embossed on the gold bars and then smuggle those into the country, the ED said. The bars were then dispatched to various domestic markets by different modes of transportation to escape the scanner of enforcement agencies.

The accused jewellers did not account for jewellery manufactured from smuggled gold. The illegal funds generated were then transferred through hawala agents based in these cities, the probe agency said.

“Searches at various premises in Jaipur, Kolkata and Chennai resulted in seizure of unaccounted Indian and foreign currency worth Rs 3.75 crore, gold bar and jewellery weighing 26.97 kg and silver weighing 12.22 kg along with incriminating documents. Electronic and digital devices seized are still to be examined and may lead to further details of illegal dealings,” the ED said. Hawala denotes the illegal manner of transferring funds by skirting banking channels and dealing in cash through agents.