New Delhi, April 3 (IANS) In a major development, the Directorate of Enforcement (ED), Jalandhar, has seized immovable properties worth Rs. 22.02 Crore of M/s Rana Sugars Ltd for violating the Foreign Exchange Management Act (FEMA), 1999. The company has been accused of holding foreign exchange outside India in contravention of Section 4 of FEMA, 1999, which mandates that foreign exchange receipts must be brought back to India.

This information was shared by ED in a press release issued here on Thursday.

The ED initiated its investigation under the provisions of FEMA, 1999, against M/s Rana Sugars Ltd, its promoters, directors, and other stakeholders, concerning the issuance of Global Depository Receipts (GDRs) and the non-utilisation of the entire proceeds for the intended bona fide purposes. GDRs are a way for companies to raise capital in foreign markets but the regulations require that the proceeds from such instruments be used in accordance with the intended objectives.

The investigation revealed that M/s Rana Sugars Ltd had failed to repatriate the entire amount raised through GDRs. Out of the total GDR receipts, the company held $2.56 million (Rs 22.02 crore) outside India, in clear violation of FEMA regulations.

This foreign exchange was not brought back to India as mandated, leading to the seizure of the company's assets.

The ED's action has been prompted by the company's failure to comply with the FEMA provisions, which are designed to regulate the flow of foreign exchange in and out of India.

Section 4 of FEMA specifically requires that foreign exchange received by an Indian entity must be repatriated to India and utilised for the declared purpose.

Currently, further investigations are underway to determine the full extent of the violations and any additional legal actions that may be taken.