In a significant development, the Enforcement Directorate (ED) has reissued a Lookout Circular (LOC) against Byju Raveendran, the founder of the popular edtech platform Byju’s, as part of an ongoing investigation under the Foreign Exchange Management Act (FEMA). The LOC, initially issued over a year ago, is a precautionary measure implemented at the country’s entry and exit points.
The ED alleges that Think and Learn Pvt Ltd, the company operating Byju’s, has violated India’s foreign exchange laws, resulting in losses to the exchequer totaling ₹9,362 crore. The purported violations include failure to submit essential documents related to imports against advance remittances made outside India, delayed filing of documents against Foreign Direct Investment (FDI), and non-compliance with various FEMA provisions.
Show Cause Notices have been issued by the adjudicating authority under FEMA to both Think and Learn Pvt Ltd and Byju Raveendran, amounting to ₹9,362.35 crore. These notices, issued under section 16 of FEMA, mark a critical phase in the ongoing investigation.
The ED’s probe is rooted in multiple complaints related to foreign investment received by Byju’s and its business practices. The company is accused of significant foreign remittances and investments abroad, allegedly contravening FEMA provisions and causing a substantial revenue loss to the Indian government.
After conducting searches on Byju’s premises in April 2023, the ED claimed that the company had received foreign direct investment totaling around ₹28,000 crore from 2011 to 2023. Byju’s is alleged to have remitted ₹9,754 crore to various foreign jurisdictions during the same period under the guise of overseas direct investment.
In a move to ensure the continued presence of Byju Raveendran during the ongoing FEMA probe, the ED has requested the Bureau of Immigration (BOI) to issue a fresh Lookout Circular against the founder. This measure is intended to prevent Raveendran from leaving the country.
Byju’s, founded in 2011, experienced significant growth, particularly during the Covid-19 pandemic. The edtech giant, which also owns Aakash Educational Services, providing courses for medical and engineering entrance exams, now faces sustained legal scrutiny and challenges with the renewal of the Lookout Circular against its founder.
