The Directorate of Revenue Intelligence (DRI) has initiated an investigation into Adani Enterprises’ defence arm for allegedly evading import duties worth Rs. 77 crores (around $9 million) on missile components, according to two government sources with direct knowledge of the matter. The probe, which began in March 2025, marks another round of regulatory scrutiny for the diversified Adani Group.
Investigators allege that Adani Defence Systems and Technologies Ltd., which manufactures missiles, drones, and small arms for Indian security forces, misclassified short-range missile components as long-range missile parts to claim exemptions from customs and local taxes. The alleged duty evasion is significant, as it represents over 10% of the company’s 2024–25 revenue of $76 million and more than half its profit.
One government source said Adani executives admitted to the misclassification during the probe. Typically, such cases attract a 100% penalty in addition to the duty evaded, potentially raising Adani Defence’s liability to around $18 million (₹154 crore).
Responding to queries, the Adani Group stated that the DRI had merely “sought clarifications” regarding its imports based on their interpretation of customs rules. The company added that it had submitted all required documents and that the matter “stands closed from our end.” However, it did not confirm whether any payments were made to settle the alleged dues.
The probe pertains to non-explosive parts and accessories used in manufacturing short-range surface-to-air missiles and their launch mechanisms. These components reportedly attracted a 10% customs duty and 18% local tax, but were wrongly declared as exempt under the classification for long-range missile systems.
Trade data shows that Adani Defence imported $32 million worth of such missile parts from Russia since last year, while its total defence-related imports from Russia, Israel, and Canada amounted to around $70 million since January 2024.
Adani has cited a September 2025 policy amendment by the Indian government, which now exempts all missile parts—short- and long-range—from customs duties. However, officials clarified that this exemption did not apply to the period under investigation.
The Adani Group remains under the regulatory spotlight. Though the Securities and Exchange Board of India (SEBI) recently cleared it in two stock manipulation cases, multiple other inquiries are ongoing, including a long-standing probe into over-invoicing of coal imports dating back to 2014.
The DRI has also issued notices to Samsung and Volkswagen in recent months for alleged misclassification of imported goods, both of which are contesting the findings.
In August, Adani Group Chairman Gautam Adani stated that the company’s drones were deployed by Indian forces during recent border conflicts with Pakistan, highlighting its growing role in India’s defence manufacturing sector.
The investigation into Adani Defence’s import classifications is ongoing, and no final determination has yet been made by the DRI.
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