The Enforcement Directorate (ED) on Wednesday carried out extensive search operations at several premises linked to Delhi-based businessman Vikas Garg, now known as the chairman of Ebix Inc, as part of an ongoing probe into a major ₹190-crore customs duty fraud and money laundering racket. The crackdown relates to accusations of forging export documents to divert duty-free imports—particularly betel nuts and PVC resin—into the domestic market.
CBI Case Forms Basis of ED Action
The ED’s searches stem from a CBI FIR registered in 2023, which alleges that Garg and multiple associates orchestrated a large-scale customs fraud by fabricating shipping bills, export records, and customs seals.
Garg and his family members are promoters of several listed entities, including Vikas Ecotec, Vikas Lifecare, Eraaya Lifespaces, and Advika Capital. Earlier this year, he garnered significant attention after acquiring the U.S.-based, Nasdaq-listed Ebix Inc.
Previous Scrutiny: Mahadev Betting App & Market Manipulation
This is not the first time Garg’s name has surfaced in enforcement actions. In the Mahadev online betting syndicate case, ED officials had alleged that he received illicit funds from prime accused Harshankar Tibrewal. Investigators also suspect that Garg used these illegal proceeds to influence the share prices of certain listed companies.
Earlier raids in April were followed by multiple rounds of ED questioning in Raipur. The agency had also alerted the Securities and Exchange Board of India (SEBI) to examine possible stock-market manipulation by companies associated with Garg.
How the Duty Evasion Scheme Worked
According to the CBI FIR—based on inputs from the Directorate of Revenue Intelligence (DRI)—the core of the fraud involved the misuse of Free Trade Warehousing Zones (FTWZs) in Maharashtra.
Titan Sea & Air Service Pvt. Ltd., a Mumbai-based logistics company headed by Jagannath Rai and Chandra Shekhar Rai, was authorised to import goods without paying customs duty under Section 7 of the SEZ Act, 2005, on the condition that the goods would be re-exported.
Between 2015 and 2017, instead of exporting the duty-free consignments, the company allegedly imported large quantities of PVC resin and betel nuts from Dubai and Indonesia. Diverted these consignments into the domestic Indian market without paying customs duty. Created forged shipping bills, fake customs seals, and fabricated export documents showing fictitious exports to Nepal and Bangladesh. Sold the diverted goods to domestic buyers, including Sakshi Marketing Pvt Ltd, located in Delhi.
The CBI has also named Pradeep Kumar Mittal, a Dubai-based businessman linked to Al Duquq General Trading LLC and Land Star Ltd., UAE, alleging that Garg acted as his Indian associate in the illegal import–diversion network.
Two others, Jitendra Bansal and Brij Mohan Bishnoi of GRC India Logistic, have been accused of generating forged transport documents to facilitate the diversion.
Rs. 190 Crore Loss to the Exchequer
Investigators estimate that the fraudulent diversion of duty-free goods resulted in a massive ₹190-crore revenue loss to the central government during the two-year period.
The CBI has booked the accused under charges related to Criminal conspiracy, Cheating, Forgery under IPC, and Corruption under the Prevention of Corruption Act, 1988.
ED Probing Laundering of Proceeds of Crime
Following the CBI case, the ED registered an Enforcement Case Information Report (ECIR) under the Prevention of Money Laundering Act (PMLA).
The raids conducted this week in Delhi, Mumbai, and multiple other cities are aimed at:
- Tracing the flow of allegedly laundered funds
- Identifying shell companies used to route illicit money
- Recovering digital evidence, financial ledgers, and incriminating documents
Officials said the probe will focus on whether profits from the customs duty fraud were funneled into Garg’s business network or used in stock-market manipulation schemes.
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