Adani Group has denied allegations of overvaluing the power equipment used in its projects in IndiaGetty Images
Indian mining giant Adani Group has been cleared of illegally siphoning money to offshore tax havens by the country’s customs authority.
Indian customs investigators had raised allegations in 2014 that Adani was using a front company in Dubai and other intermediaries to overvalue machinery and equipment imported for electricity projects in India.
The inflated amounts paid for the equipment were alleged to have been routed to a holding company in Mauritius managed by Vinod Shantilal Adani, the older brother of Adani Group chief executive Gautam Adani.
However, an official at India’s Directorate of Revenue Intelligence (DRI) appointed to adjudicate the case struck down the claims this week, the Indian Express newspaper reported.
KVS Singh said that while the Adani subsidiaries operating power projects in the states of Rajasthan and Maharashtra were connected to the Dubai front company EIF through Vinod Adani, he had come to the conclusion that the relationship had not affected the transaction value of the imported equipment.
“I find that the allegation that the impugned goods were overvalued does not hold water,” he said in his ruling on 22 August.
Sources told the Indian Express that the ruling was a big blow to a separate DRI investigation against the Adani Group and other Indian firms that are looking into claims they overvalued electricity equipment imports through a similar modus operandi.
The Adani Group has denied the allegations, with the company saying in a statement to the Guardian that it would continue to cooperate with the DRI’s investigation.
“It is a standard procedure for the group to follow international competitive bidding route for major capital expenditures to ensure transparency and competitiveness in the process,” it said.
“All our transactions are always conducted within the framework of extant regulatory guidelines and provisions.
“The fact that our projects have incurred the lowest cost across central, state and private utility players has gone to establish the robustness of the processes followed by our group.”
Meanwhile, a court in Brisbane has dismissed the Australian Conservation Foundation’s appeal against Adani’s controversial Carmichael coal mine in Queensland on 25 August.