The Enforcement Directorate (ED) has issued a Show Cause Notice (SCN) to One97 Communications Ltd (OCL), the parent company of Paytm, along with its Managing Director and subsidiaries, for violating the Foreign Exchange Management Act (FEMA), 1999. The notice, issued by the Special Director of Enforcement (Adjudication), New Delhi, alleges financial irregularities involving foreign investments worth ₹611 crore.
According to ED’s investigation, OCL made foreign investments in Singapore but failed to report them to the Reserve Bank of India (RBI), which is required when creating overseas subsidiaries. Additionally, the company received Foreign Direct Investment (FDI) from foreign investors without following RBI’s pricing guidelines.
ED also found violations in OCL’s subsidiaries:
- Little Internet Pvt Ltd received FDI without following RBI’s pricing rules.
- Nearbuy India Pvt Ltd failed to report its FDI within the required timeframe.
With these findings, the Show Cause Notice has been issued to start adjudication proceedings under FEMA, 1999.
