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ED notice to Paytm parent over Rs 611 crore Fema violation

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NEW DELHI: The Enforcement Directorate (ED) has issued a show-cause notice to One97 Communications, the parent company of Paytm, over alleged violations of the Foreign Exchange Management Act (Fema) in transactions amounting to Rs 611 crore.
The notice, dated Feb 27, cited alleged contraventions between 2015 and 2019 related to Paytm’s acquisition of two subsidiaries, Little Internet and Nearbuy India.
The company disclosed the development in a regulatory filing on Saturday, stating that it is currently seeking legal advice and evaluating its options to address the allegations.
Paytm acquired Little Internet and Nearbuy India in Dec 2017 as part of its strategy to expand its presence in offline commerce.
According to the ED’s notice, the alleged violations pertain to investment transactions involving One97 Communications and its subsidiaries.
Paytm has said that some of these transactions predate its ownership of the two companies, suggesting that a portion of the alleged contraventions occurred before they became subsidiaries of One97 Communications.

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