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Walmart investment in subsidiary as per law: Bharti Enterprises

Bharti Enterprises has rejected allegations that it had violated rules in the investment by Walmart Stores Inc in its subsidiary.

BT Online Bureau | October 30, 2012 | Updated 14:32 IST

Bharti Enterprises has rejected allegations that it had violated rules in the investment by Walmart Stores Inc in its subsidiary.

The Rs 455.8 crore investment by Walmart in Cedar Support Services Ltd - a subsidiary of Bharti Ventures - had come under attack from CPI Rajya Sabha member M P Achuthan, who wrote to Prime Minister Manmohan Singh in September saying it was "illegal" and flouted FDI rules.

"(There is) no violation. It is as per the law of the land," Bharti Enterprises Vice-chairman and Managing Director Rajan Bharti Mittal said.

In the letter to the prime minister, Achuthan, a Member of the Standing Committee on IT had alleged "the entire FDI has been diverted and illegally invested by Cedar in its 100 per cent subsidiary Bharti Retail Ltd, which is carrying out multi-brand retail operations".

Stating that the fact could be verified from the audited accounts filed by Cedar with Registrar of Companies, the MP had asked the government to "undo this illegal investment immediately; initiate penal proceedings against Walmart and Bharti group under FEMA".

Achuthan had further said: "Ban Walmart permanently from India , including its joint venture for the wholesale cash and carry operations with the Bharti Group."

Mittal said the government had also asked about the investment and the company has furnished details.

"We have given them (replies)...We have given our submissions to the government," Mittal said when asked to comment on Department of Industrial Policy and Promotion referring the issue to RBI.

When asked for comments about Commerce and Industry Minister Anand Sharma informing the Rajya Sabha in September that Walmart had made the investment in Cedar via its Mauritius arm but the RBI had no FDI data of the same, Mittal said: "I have no idea. We have given everything what is required".

With inputs from PTI

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