NEW DELHI: The edtech giant BYJU and its CEO and co-founder, Raveendran Bjyu, were the targets of a show-cause notice for foreign exchange violations worth over Rs 9,300 crore, according to the Enforcement Directorate on Tuesday. The company and its chief promoter were charged on several counts by the federal probe agency. These counts included “failing” to submit import documents against advance remittances made outside of India and failing to realise export proceeds by delaying filing documents against foreign direct investment (FDI) received by the company. The statement stated that a show-cause notice regarding the violations of the Foreign Exchange Management Act (FEMA) to the tune of Rs 9,362.35 crore has been sent to Raveendran and the registered company of BYJU’s, Think & Learn Private Limited. The ED may fine FEMA violators up to three times the amount specified in the show cause notice following the final adjudication. The agency claimed that after conducting searches at three locations in April, including Raveendran’s home in Bengaluru, it recorded statements made by the chief financial officer of BYJU and Raveendran. It said the action was taken in response to complaints about Think & Learn Private Limited’s “business conduct” and the foreign investment it had received. According to the ED, the company was accused of making large foreign investments and remittances outside of India in violation of the terms of the FEMA, 1999, resulting in revenue losses for the Indian government.The ED stated that after conducting the investigation, it was discovered that Think & Learn Private Limited and Raveendran had “contravened” the FEMA provisions by neglecting to file import documents against advance remittances made outside of India, failing to realise export proceeds made outside of India, delaying the filing of documents against Foreign Direct Investment (FDI) received by the company, failing to file documents against FDI received by the company, and failing to allot shares against FDI received by the company. The Enforcement Directorate (ED) declared following the searches in April that “the company (Think & Learn Pvt. Ltd.) has not prepared its financial statements since 2020-21 fiscal and has not got the accounts, audited which is mandatory.” According to the searches, the company received approximately Rs 28,000 crore in foreign direct investment (FDI) between 2011 and 2023. “The company also remitted about Rs 9,754 crore to various foreign jurisdictions during the same period in the name of overseas direct investment,” according to the agency. The ED claimed that the company recorded marketing and advertising costs totaling approximately Rs 944 crore, including money sent to overseas jurisdictions. In addition to offering early learning, middle school education, and test preparation, the Bengaluru-based company was co-founded by Raveendran Bjyu and his spouse, Divya Gokulnath. The company announced earlier this month that its operational losses in its core business for the fiscal year 2021–2022 had shrunk to Rs 2,253 crore.
