The Enforcement Directorate has stepped up its probe into the manipulation of prices of pulses in 2015, which had caused a sharp rise in pulse prices back then.
The agency has started calling the officials of companies which are suspected of having colluded to manipulate the prices.
An Income Tax probe into the spike in pulse prices found that the Glencore Group, Edelweiss Group and ETG Group were the major players in this operation.
"In the first phase, senior officials of Edelweiss have been called to explain their involvement in the pulses scam,” a source familiar with the development told Moneycontrol, adding that officials at other firms too will be called. The source said that the agency was reviewing an appraisal report by the I-T which said that offshore entities part of the Edelweiss Group may be involved in money laundering.
Edelweiss had shut down its international commodities operation in 2016.
An I-T source, who was part of the search operations said, there was a case for SEBI as well to look into the matter as the agency had come across instances of manipulation of chana contracts in the commodities market.
The Economic and Political Weekly, which broke the pulses rigging story in 2017 based on the I-T report, said that the price surge was the result of a coordinated collusive activity by few trading and financial entities. Physical stocks of pulses (were) cornered in domestic and international markets, and significant long positions on the future were taken on exchanges to create an artificial scarcity at the wholesale and retail levels.
An excerpt from the EPW report:
“A few major commodity dealers having a presence in overseas markets as well created a monopolistic condition by procuring and hoarding stocks of pulses in national as well as overseas markets. They rigged domestic rates to an unprecedented level to offload their stock procured at a low rate. The super profit earned in this manner was not offered to tax and siphoned off either abroad or converted into unaccounted cash through entry operators.”
The other companies which have been named in the Income Tax report are the Jindal Group comprising Dalip Jindal, Pradip Jindal, Jindal Agro; Vikas Gupta, Superior Group; Manoj Agrawal; SV Agri Trade; Sharp Mint Group, Riddhi Siddhi Impex, Parth International, Gayatri Maa, Gunn Enterprises, Charles India Private Limited.
Last week, the ED had summoned Edelweiss co-founder and Chairman Rashesh Shah in connection with the investigative agency's probe into alleged money laundering activities by currency exchange firm Capstone Forex Pvt Ltd. Edelweiss has denied having any links with Capstone.
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