Shares of Paytm proprietor One97 Communications on Monday plunged greater than 4 per cent after the enforcement directorate has despatched a discover to the fintech agency for the alleged violation of sure FEMA guidelines by the corporate and its two subsidiaries with respect to sure funding transactions.
QR codes of digital cost corporations PhonePe and Paytm are seen on the counter of a grocery retailer in Ahmedabad.(REUTERS)
The inventory of the corporate dived 4.39 per cent to ₹683.55 apiece on the Nationwide Inventory Change (NSE).
On the BSE, it went down by 4.37 per cent to ₹685 per piece.
The market was buying and selling within the damaging zone with the 30-share BSE Sensex benchmark slipped 271.22 factors or 0.37 per cent to 72,926.88 within the late morning commerce. Additionally, the NSE Nifty dipped 93.60 factors or 0.42 per cent to 22,031.10.
In a regulatory submitting on Saturday, Paytm mentioned that it has obtained a discover from the Enforcement Directorate (ED) for the alleged violation of sure FEMA guidelines by the corporate and its two subsidiaries — Little Web and Nearbuy — with respect to sure funding transactions.
Later, Paytm clarified that the alleged breach pertains to the interval when the 2 firms weren’t its subsidiaries.
“We hereby inform you that a show cause notice…has been received by the company on February 28, 2025…from the Directorate of Enforcement.
“That is in relation to alleged contraventions for the years 2015 to 2019 of sure provisions of the ‘FEMA’ by the corporate, in relation to its acquisition of two subsidiaries particularly Little Web Pvt Ltd (LIPL) and Nearbuy India Pvt Ltd (NIPL), erstwhile Groupon, together with sure administrators and officers,” the company said in a regulatory filing.
One97 Communications (OCL) said that it has received a FEMA (Foreign Exchange Management Act) rules violation notice from the ED on February 28, which does not specify financial impact but alleges contraventions in respect of aggregate amount of over ₹611 crore.
According to the break-up shared by the company, OCL transactions amounting to over ₹245 crore, LIPL’s about ₹345 crore and NIPL about ₹21 crore have been listed in the alleged breach.
“The alleged contraventions relate to sure funding transactions regarding OCL, LIPL and NIPL,” it explained.
“Sure alleged contraventions attributable to 2 acquired firms – Little Web Pvt Ltd and NearBuy India Pvt Ltd – pertain to a interval when these weren’t subsidiaries of the Firm,” the filing said.
Paytm said the matter is being addressed with a focus on resolving it in accordance with applicable laws and there is no impact of this matter on Paytm’s services to its consumers and merchants, and all services are fully operational and secure, as always.
“To resolve the matter in accordance with relevant legal guidelines and regulatory processes, the Firm is looking for mandatory authorized recommendation and evaluating applicable treatments,” the submitting added.
Paytm had acquired the 2 firms in 2017.
Groupon India enterprise was began by Ankur Warikoo as its founding CEO in 2011. Warikoo and the core administration workforce of Groupon India purchased the India enterprise of Groupon in 2015 and made it an impartial entity.