By Ayush Joshi, Abir Dasgupta and Paranjoy Guha Thakurta
Documentary evidence spanning two decades exposes operational alliances, parallel policy violations and divergence in government responses to allegations of financial misdemeanour and fraud in entities associated with the Adani group and Rajesh Exports. In the same area of business, that is, trading in diamonds and gold, come the dubious activities of fugitive Jatin Mehta, who is related by marriage to Adani group head Gautam Adani’s older brother Vinod Adani.
In an interim order of the Securities and Exchange Board of India (SEBI) dated June 3, 2026, Rajesh Exports Limited (headed by Rajesh Mehta) has been accused of having falsified accounts to the extent of over a mind-boggling Rs 15,00,000 crore (roughly US$ 157 billion at current exchange rates) over a period of four years. In the history of India, no corporate group has ever been accused of illegally inflating income to such a huge extent.
Records establish that the conglomerates led by Rajesh Mehta and Gautam Adani had formed manufacturing and trading alliances to take advantage of the government’s export promotion schemes related to cut-and-polished diamonds and studded gold jewellery in the early 2000s. The alleged financial irregularities that followed triggered interventions from the Directorate of Revenue Intelligence (DRI) in the Union Ministry of Finance and SEBI, the regulator of the country’s financial markets. Internal government memos detail how public funds were mobilised through the Life Insurance Corporation of India (LIC), which helped shield the Adani group from financial volatility. This kind of government support was absent for Rajesh Exports, in which entity LIC holds a 10.8 per cent stake. Meanwhile, Jatin Mehta remains an absconder from Indian law.
We break these complex associations into separate segments.
Exploiting a Scheme to Trade in Diamonds and Gold Jewellery
Throughout the 1990s and the first decade of the new millennium, the Ministry of Commerce and Industry, through the Directorate General of Foreign Trade (DGFT), rolled out a series of export incentive schemes. These included the Duty-Free Credit Entitlement (DFCE) Scheme and the Target Plus Scheme, which rewarded export houses, particularly large entities classified as Star Trading Houses and Status Holders, with duty-free import credits linked directly to their incremental export growth.
While the stated policy goal of these schemes was the expansion of international trade and the generation of employment at home, there is substantial evidence that they degenerated into sophisticated forms of regulatory arbitrage, capital flight, and systemic corporate opportunism.
It was in this environment that the corporate conglomerate led by Gautam Adani entered the opaque and lightly regulated business of cut-and-polished diamonds (CPD) and gold jewellery. Having built its early business around commodities trading, the Adani Group expanded aggressively into the diamond and bullion trade through its flagship company, Adani Exports Limited (later renamed Adani Enterprises Limited, or AEL).
Before its shift towards infrastructure, the group’s business was centred on trading in CPD and gold jewellery—low-volume, high-value commodities whose prices are often difficult to verify with precision. That opacity made the sector particularly vulnerable to manipulation. Suspicions of financial irregularities in the group’s trading activities eventually attracted the attention of government investigators, leading to multiple official probes.
Set up in Ahmedabad in 1987, AEL traded in various commodities such as textiles, coal, naphtha, agricultural products, petrochemicals, petroleum products, metal scrap, and diamonds. The major directors steering the company were Gautam Adani, Rajesh Adani, and Vasant Adani. Around the same time, Rajesh Exports was steadily expanding its presence in the precious metals trade from Bengaluru.
In 2002–03, the combined export turnover of AEL and its associated companies stood at Rs 412.53 crore, with AEL accounting for the lion’s share at Rs 377.44 crore. The associated companies that contributed to the turnover included Midex Overseas Limited (Rs 28.26 crore), Hinduja Exports Private Limited (Rs 4.15 crore), and Aditya Corpex Private Limited (Rs 2.68 crore). The Adani group expanded its overseas presence in the summer of 2003 by incorporating Mine Gold and Jewellery FZCO (Free Zone Company) in Dubai in the United Arab Emirates (UAE).
The Adani group rapidly expanded in 2003-04, following the introduction of the Incremental Export Promotion Scheme by the DGFT. This initiative was designed to benefit Star Trading Houses, granting them financial benefits equal to 10 per cent of the total incremental exports, provided the growth in turnover reached at least 25 per cent when compared to the previous year.
Implementation of this export promotion scheme triggered a surge in the trade volumes reported by the Adani group. That fiscal year, total combined exports of the group jumped more than fifteen times to Rs 6,203.83 crore, driven primarily by exports of cut and polished diamonds and studded gold jewellery. The exports of AEL grew phenomenally by 1,181 per cent to Rs 4,838.53 crore. In 2003-04, the export turnover of Hinduja Exports Private Limited grew by an astounding 16,624 per cent to Rs 694.07 crore, that of Aditya Corpex Private Limited grew by 15,819 per cent to Rs 426.63 crore, while the corresponding figures for Midex Overseas Limited were 765 per cent and Rs 244.60 crore.
Alliance Between Adani Group and Rajesh Exports
To manage the surge in export turnover, AEL not only formed a consortium with group companies like Hinduja Exports, Aditya Corpex and Midex Overseas. It associated itself with entities such as Jayant Agro Organics Limited and Bagadiya Brothers Private Limited. The Adani group required specialised skills to convert imported raw gold into refined gold, which would then be made into jewellery studded with diamonds and other precious stones. This is how Rajesh Exports, managed by Rajesh Mehta and Prashant Mehta, not only entered the scene and became the most critical “job worker” for the Adani group.
Prashant Mehta recorded an official statement on March 8, 2005, confirming that Rajesh Exports manufactured the jewellery exported by AEL. His statement is recorded in a show-cause notice (SCN) issued by the Directorate of Revenue Intelligence (DRI), the customs intelligence arm of the then Central Board of Excise and Customs (CBEC), now known as the Central Board of Indirect Taxes and Customs (CBIC) under the Ministry of Finance. He further confirmed that Rajesh Exports imported raw gold directly on AEL’s behalf.
All these and more details are given in two show cause notices (SCN) issued by the DRI, the first dated March 30, 2007, and the second dated September 11, 2009. Both SCNs can be accessed at https://adanifiles.paranjoy.in/documents
The Adani group was apparently entirely responsible for handling the financial arrangements of this manufacturing alliance. Prashant Mehta explained in his deposition to DRI officials that Rajesh Exports opened the letters of credit for the imports, but the actual payments for the imported raw materials were executed directly by AEL. The job work and commission charges were managed through an oral agreement, with rates for the manufactured items fixed daily on a per gramme basis. After manufacturing the studded jewellery, Rajesh Exports delivered the finished goods to security agencies designated by AEL, thereby relinquishing all further responsibility for the export process. Another external manufacturer, Master Chain Private Limited, confirmed receiving 38,19,205 grammes of gold from AEL and supplying an equal quantity of manufactured studded gold jewellery back to the company by April 2005.
Corporate Restructuring at Adani
The government moved quickly to restrict the exploitation of the export promotion scheme. In January 2004, the DGFT issued Notification No. 28/2003 and Public Notice No. 40, explicitly stating that the exports of precious metals in any physical form, including plain jewellery and rough uncut diamonds, would no longer be permitted for counting towards the free on board (FOB) value required for entitlement to export incentive schemes. Adani Exports Limited challenged the restriction by filing Special Civil Application No. 1676 of 2004 before the Gujarat High Court, refusing to comply with the government’s notices.
Simultaneously, the Adani consortium underwent internal corporate restructuring. Hinduja Exports was acquired by Ambitious Trade Link Private Limited, which appointed Samir Vora and Deven Mehta as primary directors. Vora was already an active employee of AEL. He is the brother-in-law of Gautam Adani. Aditya Corpex was taken over by Milestones Trade Link Private Limited, appointing Rakesh Shah as a director who happens to be another brother-in-law of Gautam Adani.
Circular Trading to Boost Turnover
The regulatory and commercial environment provided a new opportunity when the eligibility period for a new export promotion scheme called the Target Plus Scheme was introduced by the DGFT in September 2004. This new policy offered “sliding” export incentives ranging between 5 per cent and 15 per cent based on the percentage of incremental growth achieved. The Adani group immediately availed of this scheme, incorporating Al Shahad Gold and Jewellery LLC (limited liability company) in the UAE on September 6, 2004. An understanding was reached between AEL, Jayant Agro Organics, Bagadiya Brothers and Midex Overseas to arrange for incremental exports.
Internal communications seized by DRI investigators exposed the exact modus operandi of the circular trading. The goods processed by job workers like Rajesh Exports were exported to the UAE. The buyers were front companies overtly and covertly controlled by the Adani group, the DRI alleged. Such entities included Mine Gold and Jewellery, Daboul Trading, Labdhi International FZE (free zone establishment), and Al Shahad Gold and Jewellery. There were large physical movements of gold jewellery among these firms. In December 2004, D J Limited in the UAE contracted Hinduja Exports to supply gold bangles weighing 409.160 kilogrammes valued at $6,120,400, and pendants with 306.870 kg of gold valued at $4,590,300. Days later, Labdhi International FZE issued a purchase order to Adani Exports Limited requesting studded gold bangles (409.16 kg of gold) valued at $6,079,312 and gold chains (306.87 kg of gold) valued at $4,559,484, totalling $10,638,796.
The movement of funds among entities was rapid. An executive, Sudhakar Nair, confirmed to DRI investigators that the opening of a new bank account for Al Shahad Gold and Jewellery at the Bank of Baroda, Bur Dubai Branch, on December 8, 2004. The same day, one Mary Joseph confirmed a transfer of $7,288,886 received in Daboul Trading, which was immediately transferred out to Labdhi International to retire corporate bills using funds from Andhra Bank and Punjab National Bank. Further documented financial movements confirmed bill retirements from Labdhi International using funds from the Development Credit Bank and the State Bank of Saurashtra. In February 2005, Joseph recorded that additional funds were received in entities named Gold Star, G A International, Al Shahad, and Gudami – all of them associated with the Adani group. Records explicitly showed that $7,614,216 was transferred from G A International to Mine Gold, and $77,088 transferred from Gold Star to Mine Gold. Funds were routed from India to the UAE and back under the guise of trade, artificially inflating export turnover.
The government then decided to restrict this activity by issuing a new DGFT notification (No. 27/200409) on February 23, 2005, which completely disallowed the export of studded gold jewellery for claiming Target Plus Scheme benefits. A further restriction on exports of studded jewellery was issued from April 2004 onwards on April 8, 2005.
Adani Comes Under the Scanner
The subsequent, multi-year investigation by the DRI, India’s apex anti-smuggling agency, laid bare an ecosystem of high-velocity circular trading, misdeclaration of export values, and the utilisation of a labyrinthine web of front companies spanning multiple international jurisdictions, primarily the UAE, Singapore and Hong Kong. The DRI alleged that the Adani conglomerate had systematically exploited the DGFT’s schemes to artificially inflate export turnover, thereby illegitimately claiming thousands of crores of rupees in duty-free import scrips.
The narrative of the Adani group’s diamond and gold trading operations cannot be viewed in isolation as merely a customs dispute. It is linked to the broader, more pernicious mechanisms of crony capitalism that define contemporary India’s political economy. It intersects directly with the chilling of independent investigative journalism, the curious, pervasive reticence of state investigative and enforcement agencies under changing political dispensations, and the shadowy, offshore financial nexus involving fugitive diamantaires, most notably Jatin Mehta of the collapsed Winsome Diamonds empire, who is related to the Adani family by marriage and about whom details are subsequently given.
The DRI conducted a meticulous investigation, which culminated in the levelling of grave allegations that the Adani group had evaded taxes, manipulated export figures, and laundered money to the tune of approximately Rs 1,000 crore (equivalent to roughly US$151 million in illicit export credits). The DRI’s intelligence indicated that Adani Exports Limited—later renamed Adani Enterprises Limited (AEL), the flagship company of the diversified Adani Group—orchestrated a network of ostensibly independent entities, including Inter Continental India, PNJ Trading in Hong Kong and Little Hearts Creations. The agency alleged that this network was used to fraudulently claim benefits under the Target Plus and DFCE schemes.
Artificial Inflation and Round-Tripping
The nub of the allegations levied by the DRI was that the huge export volumes claimed by AEL and its associate companies in the early to mid-2000s were essentially a statistical mirage, achieved through what the directorate described as “high-velocity circular trading”. Circular trading, in the context of international trade, involves the repeated, rapid export and import of the identical set of goods without any actual value addition, genuine economic transformation, or transfer of ultimate ownership to an independent third-party buyer. The sole purpose of such a mechanism is to generate a massive, fictitious paper trail of export turnover.
According to the findings set out in the DRI’s SCNs, AEL imported large quantities of CPD from overseas suppliers and re-exported the same consignments—often in their original form and packaging—directly from private bonded warehouses located in India. In the case of studded gold jewellery, the DRI alleged a modus operandi that was sophisticated in design but remarkably simple in execution.
Since AEL lacked its own indigenous manufacturing facilities, it relied on a network of local job workers and supporting manufacturers in Gujarat and elsewhere. The DRI investigation alleged that large quantities of 24-carat (995 purity) raw gold were converted within days into crude bangles, chains and pendants—frequently weighing around 100 grams each—with no regard for the standard industry practices of design, finishing, and quality control.
The investigation detailed how craftsmanship was completely absent from the process. The raw gold was rolled into strips using industrial presses and embossed with basic, repetitive patterns. The DRI found that cheap, low-grade semi-precious stones were then glued onto collets solely to meet the DGFT’s technical definition of “studded jewellery”, thereby qualifying the products for export incentives. The job workers interrogated by the DRI confirmed they charged a nominal fee of between Rs 2.50 and Rs 3.50 per gramme for the work, reflecting the absence of aesthetic design and finishing.
Once this substandard jewellery was exported at mis-declared, hyper-inflated FOB values, it was allegedly shipped directly to a refinery in the UAE. There, the DRI alleged, the glued-on stones were simply scraped off, the heavy gold jewellery was melted back into bullion bars, and the gold was re-exported to Indian companies through a network of overseas suppliers allegedly controlled, directly or indirectly, by the Adani Group.
This relentless cycle of artificially inflating export turnover was designed to hit the incremental growth targets required to unlock the Target Plus Scheme benefits. The duty-free scrips obtained from the DGFT were then allegedly used to import massive quantities of bullion to feed the cycle anew. Between 2008 and 2010, utilising DFCE licenses issued against the artificially inflated exports of 2003-04, AEL imported 31,219.791 kgs of silver and 25,432.838 kgs of gold bars free of customs duty, resulting in a direct duty foregone of nearly ₹ 50 crore (to be precise, ₹49,77,65,367) calculated in just one specific segment of the sprawling, multi-jurisdictional investigation.
The forensic analysis of seized computers yielded the most significant evidence. The Directorate of Forensic Science retrieved 95 Excel files from Vipul Desai’s hard disk. The flow charts traced the circular movement of gold and funds through AEL, Mine Gold and Jewellery, G A International, Labdhi International and Al Shahad Gold and Jewellery, illustrating how the transactions repeatedly cycled through the network.
Based on this body of evidence, the additional director general of the DRI in Ahmedabad issued an SCN to AEL on March 30, 2007, detailing the allegedly fraudulent exports and the creation of a consortium specifically designed to over-invoice studded gold jewellery to avail of the benefits under the Target Plus Scheme. The DRI concluded that the rapid movement of money from India to the UAE and back facilitated the artificial inflation of export turnover. Before the notice, the consortium members had submitted applications for Target Plus Scheme licenses, claiming financial benefits that included ₹498.17 crore for AEL and ₹60.39 crore for Aditya Corpex.
Original Adjudication
The culmination of the DRI’s investigation was a sprawling 239-page adjudication order issued by the Commissioner of Customs in 2013, setting out in painstaking detail the evidence of the alleged circular trading network. The investigative findings pointed directly and unequivocally to the top echelons of the Adani family: Rajesh Adani, the younger brother of Gautam Adani and Managing Director of AEL, and his brother-in-law, Samir Vora (Vice-President of AEL). The DRI identified them as the principal architects, planners and operational heads of the alleged scheme.
According to the January 24, 2023, report by the US-based short-selling firm Hindenburg Research, provocatively titled How The World’s 3rd Richest Man Is Pulling The Largest Con In Corporate History, all strategic and policy decisions relating to the import and export of gold and diamonds by AEL and its purported front companies were taken by Samir Vora. The report cites a witness as stating that Vora managed the entire operations of the alleged front companies and used them to defraud the exchequer of export credits. Notably, Rajesh Adani was arrested twice during the initial phase of the customs investigations in 2004-05.
In 2013, acting on the evidentiary weight of the DRI dossier, the Commissioner of Customs issued a damning order, levying substantial financial penalties against the orchestrators and the corporate entities involved. These are given in the table below.
Financial penalties levied by the Commissioner of Customs in 2013 against the Adani Group and its executives, based on the DRI investigation into circular trading and export manipulation.
| Corporate Entity / Executive Individual | Official Designation/Role in the Organisation | Penalty Imposed by Customs Commissioner (2013 Order) |
| Adani Enterprises Limited (AEL) | Flagship Corporate Entity of the Adani Group | ₹25 crore ($4.6 million) |
| Five Associate Companies | Corporate Entities Controlled/Managed by the Adani Group | ₹2 crore ($0.37 million) each |
| Rajesh Adani | Managing Director, AEL | ₹1crore ($0.185 million) |
| Samir Vora | Vice President, AEL | ₹0.75crore ($0.138 million) |
Despite these formally adjudicated allegations and the administrative penalties imposed for the alleged fraud on the sovereign exchequer, both Rajesh Adani and Samir Vora were subsequently promoted to, and retained in, key executive positions within the Adani Group. Their continued rise to the group’s highest ranks signalled a dismissal of the customs authorities’ findings and reinforced an aura of corporate invincibility.
How Adani Navigated the State Apparatus
In August 2015, the Customs, Excise and Service Tax Appellate Tribunal (CESTAT) in Mumbai delivered a ruling that systematically dismantled the 2013 order of the Commissioner of Customs. The tribunal set aside the monetary penalties and dismissed the substantive findings of the years-long DRI investigation, concluding that the SCN had failed to produce “tangible evidence” of circular trading or fraudulent entitlement that could withstand appellate scrutiny.
The defence mounted by AEL, represented by senior lawyers such as J C Patel, Amit Ladhha, and Hardik Modh, was multi-pronged, deeply technical, and heavily reliant on procedural jurisprudence rather than facts. The core arguments accepted by CESTAT hinged on bureaucratic proceduralism and inter-departmental contradictions. AEL’s counsel argued that at the exact time of export, expert customs appraisers had physically verified and formally approved the declared export values and descriptions of all consignments without raising any immediate dispute. Therefore, retrospective allegations of misdeclaration based on subsequent intelligence were legally untenable. They further argued that genuine processing—such as sieving, boiling, and sorting of unassorted diamonds—had occurred, altering the physical characteristics of the goods and legally negating the charge of mere round-tripping.
Regarding studded gold jewellery, AEL’s lawyers said the company had demonstrated that it had obtained 88 advance licenses from the DGFT and had subsequently redeemed them fully. The licensing authority, the Joint DGFT situated in Ahmedabad, had issued a formal order on December 27, 2013, accepting that there was no circular trading and that all export obligations had been discharged according to the letter of the law. The CESTAT reasoned that since the DGFT—the very sovereign body that authored and issued the Target Plus and DFCE schemes—had treated the transactions as valid and initiated no legal action for the cancellation of the licenses, customs officials did not have the jurisdiction nor did they possess the legal right to unilaterally allege fraud, usurp the DGFT’s authority, and restrospectively demand alleged dues.
The 2015 CESTAT order (Commissioner of Customs versus Samir Vora) created an insurmountable legal precedent that AEL effectively wielded as an impenetrable shield to quash all subsequent SCNs. When the Union Finance Ministry’s revenue department appealed the CESTAT decision before the Supreme Court of India, the apex court upheld the tribunal’s findings in 2016 (Commissioner of Customs vs Adani Enterprises Ltd 2016 A50). The Supreme Court dismissed the government’s subsequent review petition on March 30, 2017.
The Supreme Court effectively sterilized the DRI’s fundamental allegation of circular trading across all parallel investigations. The chilling effect of this legal finality was evident in subsequent, drawn-out legal battles that persisted for years. For instance, in a highly significant judgment dated December 3, 2024, CESTAT Ahmedabad heard Customs Appeal Nos. 10001-10003 of 2024 regarding fresh demands raised by the Customs department based on a 2012 SCN related to the DFCE scheme. The tribunal noted that the foundational allegations in the 2012 notice were virtually identical to those in the 2007 notice, which had previously been quashed by the Supreme Court.
Applying the strict legal doctrine of res judicata, the principle that the issue was no longer res integra (a matter not yet decided), CESTAT Ahmedabad summarily set aside the Principal Commissioner’s orders, comprehensively clearing AEL, Rajesh Adani, and Samir Vora once again.
What stands out most starkly in this prolonged judicial chronology is the evolving posture of the government of India and its agencies and departments. Independent political analysts and opposition politicians, including Jairam Ramesh of the Indian National Congress, have repeatedly pointed to the government’s “strange reticence”, particularly within the Union Finance Ministry. They cite its failure to vigorously pursue these cases, file robust curative petitions, or structurally amend the law to protect the exchequer’s revenue interests. The government’s shift from an aggressive stance to relative passivity after the political transition in 2014, when Narendra Modi assumed office as prime minister, drew widespread scrutiny. It also prompted direct public accusations that the state machinery had been pressured to go easy on pursuing the allegations against the Adani Group, which critics alleged was deeply and symbiotically integrated with the ruling political establishment.
The legal resolution of the DRI’s investigation spanned over a decade and resulted in bifurcated outcomes across judicial fora. Following the SCNs issued in 2007, the dispute regarding the eligibility of the consortium to claim export benefits went to the Supreme Court. In October 2015, the apex court ruled in favour of the DGFT in a case relating to Kanak Exports Limited. This ruling upheld the government notifications that restricted the export schemes. The division bench of the Supreme Court issued a strongly worded judgment upholding that Adani Exports Limited and other associated entities engaged in “pernicious” and “blatant” misuse of the provisions of the export incentive schemes. The apex court explicitly observed that the companies fraudulently inflated their export turnover. This final judicial determination officially denied the Adani consortium the financial benefits they had claimed under the Target Plus Scheme. But there was a catch.
Was Adani Shielded From Severe Penalties?
Despite the Supreme Court recognising the systematic manipulation of trade policy, the separate customs duty demands, confiscations, and financial penalties aggressively pursued by the DRI were subsequently quashed. The CESTAT dismissed the multiple appeals filed by the revenue authorities in the Union finance ministry. The tribunal ruled that the investigators failed to establish circular trading or overvaluation under the strict parameters of customs law. The tribunal noted that the export consignments of studded jewellery had been physically examined and officially cleared by customs officers at the ports prior to departure.
Moreover, the CESTAT cited the absence of a legally admissible matching financial trail that corresponded directly with the allegedly circular physical movements. Consequently, while the Supreme Court blocked the Adani group from extracting further benefits from the export promotion scheme, the parallel rulings of the tribunal effectively shielded the group from paying the stiff penalties and duty recoveries sought by the DRI.
Intersection of the 80:20 Gold Scheme
The gold trading activities of both the Adani group and Rajesh Exports intersected again during the 80:20 gold import and export scheme rolled out by the Reserve Bank of India (RBI) in July 2013, during the last year of the second United Progressive Alliance (UPA) government, when Palaniappan Chidambaram was the finance minister. The policy required entities to export 20 per cent of their imported gold before they could access the remaining 80 per cent of the gold for sale in the domestic market. A crucial regulatory change was made on May 21, 2014, days before the National Democratic Alliance government led by Prime Minister Narendra Modi formally assumed office. This change permitted large exporters and “trading houses” to directly avail the benefits of the scheme.
The exploitation of the amended policy was extensive between May 2014 and November 2014. During this period, more than 250 small firms sprang up to provide rapid turnaround services to larger companies, converting raw bullion into 24-carat chains and bangles within 24 hours for immediate export to satisfy the scheme’s requirements. Total transactions executed under the scheme aggregated Rs 2,65,000 crore, equivalent to $35 billion (at the then prevailing exchange rates). Both Rajesh Exports Limited and entities connected to the Adani Group were heavily involved in these transactions before the government officially scrapped the scheme in November 2014. Besides these two, well-known companies and banks in the private sector (Reliance Industries Limited, HDFC Bank, Kotak Mahindra Bank, Yes Bank etc.) and the public sector (State Bank of India, Punjab National Bank, Union Bank of India, Indian Overseas Bank and MMTC Limited, formerly Minerals and Metals Trading Corporation) availed of the 80:20 scheme.
The Comptroller and Auditor General (CAG) of India later published a detailed report that criticized the scheme in no uncertain terms for actively facilitating round tripping and money laundering.
Alleged Fraud in Rajesh Exports
While its early operations involved coordinated physical trade, the subsequent regulatory violations by Rajesh Exports Limited and the Adani group centred around allegations of misrepresentation of accounts and fraud.Between April 2020 and March 2025, Rajesh Exports allegedly engaged in a systematic falsification of its consolidated and standalone financial statements, triggering a major investigation by SEBI. The investigation by the regulator of the country’s financial markets, which formally appointed BDO India Services Private Limited as a forensic auditor in December 2024, uncovered a gigantic alleged fraud across both the domestic and international operations of Rajesh Exports, the largest ever for an Indian group.
The company artificially inflated its consolidated revenues by claiming unverified transactions through its overseas subsidiaries. Rajesh Exports reported consolidated revenues from operations that jumped from Rs 2,58,306 crore in 2020-21 to Rs 4,23,099 crore in 2024-25. Over 97 per cent of these reported revenues were attributed to Global Gold Refineries AG, a Swiss subsidiary that was merely a holding company for Valcambi SA.
The company ignored the audited standalone revenue of Valcambi SA (Société Anonyme, or a kind of public limited company), which stood at only 31,828 million Swiss Francs for the calendar year 2023. Instead, Rajesh Exports allegedly incorporated the unaudited, gross transaction values recorded by the holding company into its consolidated reporting. This deceptive method resulted in the misrepresentation of a stupendous Rs 15,15,385 crore (over Rs 15 lakh crore or 15 followed by 12 zeros) in revenue over five years, representing 99.80 per cent of the company’s total consolidated revenue.
Rajesh Exports allegedly compounded the non-compliance by actively refusing to provide the forensic auditor with access to its enterprise resource planning (ERP) systems and books of accounts, citing Swiss data protection laws as a legal excuse to withhold critical corporate information. The forensic audit report, prepared in March 2026, highlighted severe restrictions on the scope of the audit due to this significant non-cooperation.
On a standalone basis within India, Rajesh Mehta orchestrated a distinct scheme involving fictitious corporate physical trades. Between the financial years 2021-22 and 2023-24, Rajesh Exports Limited recorded fictitious sale transactions aggregating Rs 11,487 crore and purchase transactions aggregating Rs 11,488 crore with Affluence Shares and Stocks Private Limited. These transactions constituted roughly two-thirds of the company’s standalone sales and purchases.
Investigators discovered that these were not genuine trades, but instead corresponded directly to gold derivative trading executed by Rajesh Mehta through his personal trading account with Affluence. Rajesh Exports Limited transferred Rs 7.45 crore of corporate funds directly to Rajesh Mehta. After incurring a trading loss of over Rs 3.50 crore, he received the net balance and returned Rs 3.91 crore to the company. The company, whose shares are publicly listed, then recorded these personal derivative trades and financial losses as physical sales and purchases of gold in its corporate ledger. This routing of funds was executed without the approval of the company’s board of directors or its audit committee and was never disclosed to shareholders as a related party transaction.
Rajesh Mehta also diverted corporate funds to entities under his control. Between April 1, 2020, and December 31, 2025, Rajesh Exports transferred Rs 565.88 crore to Elest Private Limited, a company incorporated by Rajesh Mehta and Prashant Mehta with a nominal capital of Rs 1 lakh. During the same period, Elest transferred back Rs 350.03 crore, resulting in an unexplained net outflow of Rs 215.85 crore from the public company. Despite these large fund transfers, Rajesh Exports Limited disclosed a minor rental income of Rs 12.60 lakh from Elest in its annual reports.
SEBI claims it repeatedly demanded documents to verify financial claims, but received contradictory information. On June 3, 2026, SEBI’s whole-time member Kamlesh Chandra Varshney issued the interim order against Rajesh Exports that documented the complete breakdown of corporate governance. In a second notice, SEBI restricted Rajesh Mehta from buying, selling, or dealing in any securities of Rajesh Exports until further orders.
In media interviews, Rajesh Mehta denied SEBI’s allegations and said he would cooperate fully with the regulator.
Allegations of Bribery and Expansion of Debt
During the time that Rajesh Exports Limited was allegedly falsifying its ledgers, the Adani group faced an international legal crisis. Between 2020 and 2024, prosecutors in the United States gathered evidence that Gautam Adani and his business associates orchestrated a multi-billion-dollar scheme to secure funds from American investors based on false and misleading information (see cover story in New Delhi Post).
The United States Department of Justice (DOJ) filed a five-count indictment, alleging that Adani and his associates paid over $250 million in bribes to Indian government officials to win lucrative state solar power contracts. Concurrently, the Securities and Exchange Commission (SEC) in the US filed parallel civil charges against Adani for violating the anti-fraud provisions of federal securities law. American authorities stated that the offences were committed by senior executives to finance massive state energy supply contracts through severe corruption at the strict expense of international investors.
This crisis compounded the financial pressures on the group. Hindenburg Research had previously published a detailed report accusing Adani of artificially boosting share prices using a complex web of overseas shell companies and highlighting that group companies were dangerously overleveraged. Adani denied the allegation in a rejoinder of over 30,000 words. Following the DOJ indictment in 2024, major American and European banks became hesitant to provide loans to the conglomerate. Debt piled up rapidly, rising 20% over 12 months ending in June 2026, leaving the conglomerate facing billions of dollars in maturing obligations across its massive portfolio of ports, airports, coal mines, and green energy ventures.
Rescue Operation or Regulatory Action?
The government’s response to the crisis in Rajesh Exports was different. While Rajesh Exports faced asset scrutiny and trading restrictions from SEBI, the Indian government reportedly mobilised institutions to execute a rescue operation for the Adani group. An internal document prepared by the Department of Financial Services (DFS) in the Finance Ministry in May 2025 detailed a strategy to direct investments towards Adani. The plan relied entirely on the deployment of capital from the Life Insurance Corporation of India (LIC). The LIC is a giant state-owned organisation primarily responsible for providing basic life insurance to the people of the country, especially the poor and those who live in rural areas.
DFS officials explicitly directed the LIC to deploy approximately $3.9 billion to stabilise the financial position of the Adani group, claimed a report by Pranshu Verma and Ravi Nair published in the Washington Post on October 25, 2025. The finance ministry document stated that the strategic objectives of this intervention were to signal deep confidence in the Adani group and actively encourage participation by other private investors. Finance ministry officials justified the massive capital deployment by claiming Adani was a “visionary” entrepreneur and that supporting his private business empire aligned directly with the “broader economic objectives” of India.
The government memos outlined the exact financial exposure the LIC was mandated to absorb. Officials advised the LIC to invest roughly $3.4 billion directly into corporate bonds issued by two entities, Adani Ports and Special Economic Zone Limited and Adani Green Energy Limited. The directives also advised utilising another $507 million to significantly increase LIC’s equity stakes in Adani companies, proposing to raise the stake in the group’s green energy subsidiary from 1.3 per cent to 3 per cent and its stake in one of the group’s cement companies, Ambuja Cements, from 5.69 per cent to 8 per cent.
Execution of this state-sponsored financial support was perfectly aligned with the Adani Ports subsidiary’s urgent need to raise $585 million in a critical bond issue to refinance existing corporate debt. The failure of the bond issue, exacerbated by the severe hesitancy of international banks, would have risked triggering a cascading default across the conglomerate’s portfolio. On May 30, 2026, the Adani group publicly announced that the entire $585 million bond issue had been successfully financed. The sole investor taking on the risk in the entire bond offering was the LIC.
The LC issued an unsigned statement claiming its investments in Adani group entities were not dictated by the government. Critics, however, immediately decried the deal as a blatant misuse of public funds, alleging it was designed to bail out a politically connected billionaire facing international criminal charges. In an interview with The Washington Post, Hemindra Hazari, an independent corporate finance expert in Mumbai, highlighted the extraordinary risk imposed on the state-owned insurer. He said it was “entirely abnormal” for the LIC to invest such massive sums of public money in a private corporate entity that was then facing criminal indictment proceedings in the US. Records, however, show no evidence that either the Indian government or the LIC drafted similar bailout plans or injected public funds into Rajesh Exports.
Their operations were once synchronised to exploit export promotion loopholes in the early 2000s. Once the groups came under scrutiny, however, their trajectories diverged sharply. Rajesh Mehta and his enterprise were cited for complete non-cooperation. Forensic audits found that 99.80 per cent of their reported revenue had been fabricated. SEBI also barred them from participating in the securities market. Conversely, when Gautam Adani faced international bribery indictments and a 20 per cent surge in debt, the response of the Finance Ministry was quite different when it suggested a $3.9 billion exposure from the LIC to ensure that the conglomerate remained solvent.
Jatin Mehta and Collapse of Winsome Group
The Adani group says — and rightly so — that it is no longer in the diamonds, gold and jewellery business. But to understand the depth of its past involvement in the trade, and its shadowy intersection with offshore tax havens, one must trace the dark lineage of Jatin Rajnikant Mehta. Long before the names of Nirav Modi and Mehul Choksi became globally synonymous with bank fraud in India, Jatin Mehta and his network of companies orchestrated one of the largest, most brazen, wilful loan defaults in India’s financial history.
Jatin Mehta’s journey in the diamond trade began in 1985 with the incorporation of Su-Raj Diamonds (India) Limited, subsequently rebranded as Winsome Diamonds and Jewellery Limited. Operating alongside its associate entity, Forever Precious Jewellery and Diamonds Limited, the group expanded rapidly, becoming a behemoth in the Indian bullion and CPD market, ostensibly exporting vast quantities of precious stones and metals to West Asia.
In 2013, the empire collapsed by design. Mehta and his companies engineered a massive default, leaving a consortium of 14 Indian and international banks nursing losses of about Rs 6,800 crore—around $1 billion at the time. Among the worst-hit lenders were Punjab National Bank, Central Bank of India, Canara Bank and Standard Chartered Bank.
The underlying mechanism of the fraud mirrored the labyrinthine circularity seen in the DRI investigations on the Adani group. According to forensic audits and liquidator reports, the banking facilities advanced for bullion imports were systematically misappropriated, laundered, and concealed through a complex architecture of shell companies across the globe.
Kroll Advisory Solutions, which conducted a deep forensic investigation into the fraud, reported that Winsome’s claims of unpaid dues from its UAE-based distributors (which allegedly caused the default) were entirely unsubstantiated by actual physical exports. They were, in fact, fraudulent “paper” transactions backed by meticulously forged fake invoices designed to extract bank funds that were subsequently diverted into real estate and offshore havens.
As the consortium of banks realised the magnitude of the swindle, Jatin Mehta executed a pre-planned, seamless exit strategy. Fleeing India right under the nose of the regulatory and investigative apparatus in 2013, Mehta and his wife, Sonia Mehta, obtained citizenship in the Caribbean dual-island nation of St. Kitts and Nevis in 2014. India does not possess an extradition treaty with St. Kitts, providing the fugitive diamantaire with an impenetrable legal fortress against repatriation.
The escape also had political ramifications. The Indian National Congress alleged that the Union Ministry of Home Affairs had issued a highly controversial No Objection Certificate (NOC), allowing Mehta and his wife to formally renounce their Indian citizenship. The clearance was granted despite multiple First Information Reports (FIRs) already having been registered by the Central Bureau of Investigation (CBI) and complaints having been lodged by the Economic Offences Wing (EOW) of the Mumbai Police in 2014. Astoundingly, no Interpol Red Corner Notice was immediately issued by the government, allowing Mehta to seamlessly integrate his looted wealth into the global shadow financial system without fear of arrest while travelling internationally.
Bloodlines and Offshore Archipelagos
In 2012, a year before the Rs 7,000 crore banking collapse was fully engineered, Jatin Mehta’s son, Suraj Mehta, married Krupa Adani. Krupa Adani is the daughter of Vinod Adani, the elusive, immensely wealthy older brother of Gautam Adani, who now operates primarily as a citizen of Cyprus and a resident of Dubai. For years, international investigators have identified Vinod Adani as the central figure behind the Adani group’s sprawling and opaque offshore financial network, a role brought into sharp focus by the Hindenburg Research report in January 2023.
This matrimonial alliance was far from just a social union; it represented the merging of two powerful corporate ecosystems that relied heavily on international architectures using shell companies in tax havens. The Congress, led by national spokespersons such as Supriya Shrinate, accused the Narendra Modi government of acting selectively. It alleged that Mehta was granted preferential treatment, safe passage and continued “protection” because of his family ties to the Adani industrial house, which it said was close to the prime minister.
Shared Addresses, Shared Directors: The Chaim Even-Zohar Exposé
The intersection of the Mehta and Adani empires extends far beyond marriage. It reaches into the murky world of global finance and the architecture of offshore shell companies. Chaim Even-Zohar, a respected Israeli investigative journalist who has long tracked illicit flows in the global diamond trade, examined these links in an exposé titled Smoking Gun: Winsome Case Evidence Buried in Lloyd’s Insurance Policy, published in Diamond Intelligence Briefing.
Even-Zohar revealed that Suraj Mehta’s father-in-law, Vinod Adani, used the same physical address in offshore tax havens for his own operations as the one used by JRD International Ltd. Based ostensibly out of Dubai and the Bahamas, JRD International served as the apex holding company for an extensive, sprawling network of entities registered by the Mehta family across the British Virgin Islands, the Bahamas, Hong Kong, and Singapore.
Beyond sharing a brass-plate address, the corporate entities linked to Vinod Adani and the Mehta family shared several common directors. Even-Zohar’s investigation uncovered a direct shareholding link between specific Adani corporate entities and JRD International, irrefutably binding the fugitive diamantaire’s central holding company to the broader Adani offshore financial ecosystem.
Monterosa Connection
The web of shell companies used to launder the proceeds of the Winsome default provides a masterclass in jurisdictional arbitrage and financial obfuscation. According to liquidators and UK court proceedings, the misappropriated banking facilities advanced to Winsome Diamonds and Forever Precious Diamonds (which owed Rs 720 million and Rs 388 million, respectively) were systematically routed through a labyrinthine series of entities before disappearing:
Table 2: Forensics presented during UK High Court proceedings and liquidator filings detailing the shell companies used to launder the Winsome default proceeds
| Shell / Offshore Entity | Jurisdiction | Alleged Role/Fraud Proceeds Received |
| Marengo Investment Group Ltd. | British Virgin Islands | Accepted by the Mehtas as a family-owned company, the entity received £163 million in alleged fraud proceeds before being deliberately dissolved to erase paper trails. |
| Al-Noora FZE | UAE | Received $650 million. Mehtas claimed it belonged to an untraceable Jordanian Haytham Salman Ali Abu Obaidah; claimants proved Mehta established and controlled it. |
| Oriental Expressions DMCC | UAE | Owned exclusively by Sonia Mehta (Jatin Mehta’s wife); received a direct transfer of $162 million from Marengo. |
| JRD International Ltd. | Dubai/Bahamas | Apex holding company sharing addresses/directors with Vinod Adani; received $4.5 million. |
| IIA Technologies | Singapore | Received $8.42 million. |
| Polishing Technologies | Singapore | Received $7.42 million. |
| PDC Limited | Hong Kong | Received $7.33 million. |
These offshore corporate structures can be directly linked to the Adani group. This was amplified in the Hindenburg Research report. The investigation highlighted a critical, undeniable nexus involving the Monterosa Group. Alastair Guggenbühl-Even, the Chairman and CEO of Monterosa, served simultaneously as a director alongside Jatin Mehta in three companies: Forever Precious Jewellery & Diamonds Limited, Carbon Accessories Limited, and Revah Corporation Limited.
The Monterosa Group has been repeatedly identified as the ultimate beneficial owner of at least five separate Mauritius-based shell companies that have collectively funnelled billions of dollars into the listed companies of the Adani Group. These transactions sit at the heart of allegations regarding undeclared “related party” transactions and allegedly illicit circumvention of Indian securities laws regarding minimum public shareholding, as these Mauritius funds are ultimately suspected of being controlled by Vinod Adani. Thus, the trail appears to converge. Money allegedly laundered by a defaulting diamantaire and billions allegedly used to inflate the stock price of India’s largest infrastructure conglomerate seem to have flowed through the same overlapping offshore conduits. Those networks were allegedly managed by the same individuals in Mauritius, the UAE and the Caribbean.
While Indian investigative agencies, the CBI, the ED, and the Serious Fraud Investigation Office (SFIO), were apparently paralysed in their pursuit of Jatin Mehta, tangled in technicalities and political inertia, the battle for legal and financial accountability shifted thousands of miles away to the jurisdiction of the United Kingdom. This shift was largely driven by the aggressive pursuit of international liquidators and consortium banks attempting to claw back the stolen assets through civil litigation.
The detailed, day-to-day progression of this litigation has been tracked by reports in MoneyControl, Hindustan Times, and Newsclick, narrating how, nearly a decade after the Winsome default was perpetrated in India, the Mehta family finally found themselves cornered in a London courtroom.
Worldwide Freezing Order (WFO)
In May 2022, acting on behalf of Standard Chartered Bank (SCB) and the accountancy firm Grant Thornton, the High Court in London imposed a worldwide freezing order (WFO) against Jatin Mehta, his wife Sonia, and their sons Vishal and Suraj. The judicial order froze assets globally up to the value of $932.5 million, citing the overwhelming forensic evidence that the family had misappropriated $1 billion in bullion loan facilities and systematically laundered the proceeds through shell companies in England and other jurisdictions.
These reports highlighted the legal manoeuvres undertaken by the Mehtas to escape a judicial dragnet. On October 8, 2022, Danish Khan reported in the Hindustan Times that the Mehtas attempted to be discharged from the WFO, arguing that they were themselves victims of the banks, not the perpetrators of the fraud. They filed a host of applications seeking to strike out the action, claiming that the dispute was fundamentally an Indian domestic matter and that the UK was an inappropriate forum for the trial.
In November 2022, and confirmed again in a ruling in February 2023 by Justice Edwin Johnson, the High Court in London firmly and unequivocally rejected the Mehtas’ plea to discharge the freeze order. The court systematically dismantled the argument that this was an exclusive Indian dispute. Justice Johnson ruled that the claimants in the London case were not merely Indian banks, but England-registered companies that had been utilised by the Mehtas as “conduits for the passing of the funds through layers of companies” to launder the proceeds of the fraud.
The UK court noted the reality of the defendants’ physical geography: the Mehtas were all currently residing in or operating through England, the UAE, and St Kitts & Nevis in the Caribbean, and had deliberately kept themselves away from India precisely to evade the jurisdiction of Indian law enforcement. This ruling effectively cornered the family, bringing them a step closer to facing a civil trial for fraud in the UK.
The most consequential legal actions against an economic fugitive, who stole taxpayers’ money from Indian public sector banks, are being pursued by British liquidators in London courts, while the Indian government remains paralyzed because of what Opposition figures and independent journalists contend is an enforced political inertia because of the Adani family’s connections.
(Ayush Joshi, Abir Dasgupta and Paranjoy Guha Thakurta are independent journalists)
