ED seizes Rs 8.26 cr of online edu firm
The Enforcement Directorate (ED) on Friday seized funds worth Rs 8.26 crore of a Bengaluru-based online education firm, which is wholly owned and controlled by a Chinese national, as part of its probe into alleged violations of the Foreign Exchange Act.
The funds of Fijian Education Technology Pvt Ltd have been seized under Section 37A of the Foreign Exchange Management Act (FEMA), the ED said in a statement.
The company offered online education under the brand “Odaclass”, it said. The ED had conducted searches against the group in April and said that “the company is 100 percent owned by Chinese nationals and all affairs of the company, including financial decisions, are being taken by people sitting in China.”
The ED said it was confirmed that the company swindled Rs 82.72 crore in the name of advertising and marketing expenses to China and Hong Kong on the instructions of Chinese director Liu Gan.
“The company has not been able to submit any proof of receipt of service on its part and proof of advertisement published against those expenses,” it said. The company’s director and account manager “admitted” during interrogation that the payment was made only as per Kane’s instructions, the ED said.
Vedanta Hamirvasia, the company’s India director, said the Chinese director said the ads were published by Google and Facebook. However, no confirmation or invoice was submitted by these sites, it added.