ED conducts searches at offices, home of Byju Raveendaran in Bengaluru; says BYJU's CEO skipped several FEMA summons

Directorate of Enforcement (ED) has conducted searches and seizure action at three premises (2 Business and 1 residential) in Bengaluru in the case of Byju Raveendaran and his company Think & Learn Private Limited' under the provisions of Foreign Exchange Management Act (FEMA) on Saturday.

The company runs popular online education portal in the name of Byju's. During the search and seizure action various incriminating documents and digital data was seized.

The searches revealed that the ed-tech unicorn has received foreign direct investment (FDI) to the tune of ₹28,000 crore (approx) during 2011-2023.

Further, the company has also remitted roughly ₹9,754 crore to various foreign jurisdictions during the same period in the name of overseas direct investment.

Byju and his firm Think & Learn Pvt Ltd has booked around ₹944 crore in the name of advertisement and marketing expenses including the amount remitted to the foreign jurisdiction.

Besides, the company has not prepared its financial statements since FY 2021. and has not got the accounts audited, according to the press statement.

The probe against the platform was initiated based on various complaints received from private persons.

During the investigation conducted by the ED, several summonses were issued to the founder Byju Raveendaran, however, he remained evasive, the press statement added.

Further investigation is under process.

BYJU's responses to ED searches:

BYJU'S legal team spokesperson told Mint that the visit of ED officials was related to a routine inquiry under FEMA.

“We have been completely transparent with the authorities and have provided them with all the information they have requested. We have nothing but the utmost confidence in the integrity of our operations, and we are committed to upholding the highest standards of compliance and ethics. We will continue to work closely with the authorities to ensure that they have all the information they need, and we are confident that this matter will be resolved in a timely and satisfactory manner,” the spokesperson said.

Who is Byju Raveendran?

Byju Raveendran is the founder of edtech paltform BYJU's. He is the second-richest entrepreneur in the global education sector, according to the Hurun Global Rich List 2023. His net worth stands at $3.3 billion.

Byju's, which was founded in 2011 and launched its learning app in 2015, saw a business boom during the coronavirus pandemic. However, post-pandemic when the schools reopened, the popularity of the app began to wane.

This year in February, Tiger Global-backed Byju’s fired 1,500 employees, including senior executives, in the second layoff exercise.

The ed-tech firm sacked 2,500 employees in October 2022.

BYJU's funding issues:

Post-pandemic Byju's has witnessed a huge slump in funding as investors have tightened their purses for money-losing startups. The firm had posted a sharply wider net loss of ₹4,589 crore in FY21 compared to ₹262 crore a year earlier.