New Delhi: India’s Supreme Court revived the nation’s revenue department’s bid to investigate billionaire Gautam Adani’s companies, which the agency claims got undue tax benefits by overvaluing coal imports.
A three-judge bench headed by Chief Justice S.A. Bobde on Wednesday put on hold a lower court’s ruling, effectively allowing the revenue office to seek information on the case from overseas. The Supreme Court also asked Adani Enterprises Ltd. and Adani Power Ltd. to submit their stance.
India’s Directorate of Revenue Intelligence alleges that the Adani group companies had overvalued about 1,300 consignments of coal imported from Indonesia to avail tax benefits in India between 2010 and 2016. The group routed the imports through several countries and siphoned off money, according to the revenue department.
Requests to cooperate with the investigation were sent to Singapore, UAE, Hong Kong, and the British Virgin Islands in 2016. The lower court ruling had invalidated these requests last year, but the Supreme Court decision means the investigation can continue for now. The top court said it will hear the case again after two weeks.
Representatives for the Adani group didn’t immediate reply to an email seeking comment. The Adani group has in the past denied the allegations.
The investigation is part of a larger probe by the Indian revenue department for over-invoicing of imported coal and power plant equipment by several Indian electricity producers. Power tariffs in India broadly consist of two parts — the equipment cost and variable charges such as fuel. The companies benefited by seeking higher power tariffs and compensation for increased cost of fuel, according to submissions by the probe agency in the lower court.-Bloomberg