High Court (India)

June 21, 2019

Directorate Of Revenue Intelligence Tells The Bombay High Court That Adani Firm Is Trying To Impede Its Investigation

[ By Bobby Anthony ]


Adani Enterprises Ltd (AEL) is trying to “impede” a Directorate of Revenue Intelligence (DRI) investigation into a few Adani Group firms, by challenging the “well settled procedure of issuance of Letter Rogatory” (LR) in court, the probe agency told the Bombay High Court in a recent affidavit.

The DRI affidavit said that AEL moved the Bombay High Court to question the issuance of LRs only after a Singapore court allowed India’s request to access documents allegedly incriminating the Adani firm.

Allegedly, these documents contain “clinching evidence” against the Adani Group’s “blatant” hike in prices of imported coal to “siphon” money and “increase” the cost of power sold to the public in India.

Incidentally, an LR is a formal request from one country to the under the Mutual Legal Assistance Treaty (MLAT), seeking judicial assistance to access information on an offshore entity in connection with an ongoing probe.

These LRs were issued to countries including Singapore against Adani Group firms which were being probed for alleged overvaluation of Indonesian coal imports.

It may be recalled that in 2018, the AEL had moved the Bombay High Court seeking to quash all LRs issued by the Directorate of Revenue Intelligence in 2017.

After the AEL moved the Bombay High Court, it gave an interim stay to AEL, in September 2018.

Later, the DRI moved the Supreme Court after its probe came to a halt.

However, recently the Supreme Court directed the Bombay High Court to decide the case by the end of June.

Earlier, the DRI has alleged that Indonesian coal was directly exported from Indonesian ports to India, but import invoices were routed through one or more intermediaries based in Singapore, Hong Kong, Dubai and British Virgin Islands in order to artificially inflate its value.

The DRI alleged that in certain cases, the import value of Indonesian coal was artificially inflated by about 50% to even 100% by changing test reports which measure the calorific value of coal.

Such artificial inflation of the value of imported coal increases the landed cost of coal, which is a primary fuel in coal fired thermal power plants. The higher tariff dispensed by the electricity regulator to the power generator enhances the cost of purchase of the power distributor, which in turn enhanced the bills of electricity consumers, the DRI has alleged.

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