Why Is BYJU’S Under The ED Hammer?

SUMMARY

Enforcement Directorate conducted search and seizure operations at three premises linked to BYJU’S on April 27 and 28 in connection with money laundering

Under the scanner are payments in excess of INR 9,000 Cr, which were routed to foreign jurisdiction between 2011 and 2023

Brought more FDI to India than any other startup, complying with all applicable norms: BYJU’S CEO tells employees

Cornered on many fronts, many fires are engulfing BYJU’S. Despite being one of India’s most-valued unicorns, the edtech giant lands itself in a soup more often than not. From valuation markdowns and stalled growth to sabre-rattling with the law and layoffs, the edtech decacorn troubles seem to be inexhaustible. The documents revealed that INR 9,754 Cr was remitted to various foreign jurisdictions under the pretext of overseas direct investment between 2011 and 2023. What also came under the scanner of authorities was nearly INR 944 Cr earmarked for advertising and marketing expenses, which also comprised amounts remitted to foreign jurisdictions.“As we are funded by 70+ impact investors who have satisfactorily done due diligence on our operations, including all FEMA compliance, we are confident that the authorities will also come to the same conclusion,” the internal note read.ED plans to write to various financial institutions to seek various details regarding transactions and loans of BYJU’S. The agency plans to cross-verify information such as fund flow and sources of transactions.The ex-Vedanta executive Goel was interrogated weeks after he took charge as the new CFO of the company, a position which was lying vacant since December 2021.

Adding another leaf to its already long list of troubles, the company is now in the middle of a not-so-romantic rendezvous with ED sleuths, who are examining the edtech juggernaut for flouting foreign exchange norms.

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