The ED has opened an inquiry into the financial dealings of Baba Ramdev. Is it a witch-hunt by the Centre or will skeletons tumble out of Baba’s closet, asks Manoj Rawat
IN WHAT could be seen as retaliation for challenging the Central government with his black money campaign, the Enforcement Directorate (ED) has launched a probe into Baba Ramdev’s lucrative yoga empire. While the Baba’s supporters may see this as a witch-hunt aimed at intimidating a challenger, it is quite likely that some muck may emerge as the financial dealings of the various trusts and companies run by the yoga guru are not completely above board. The various trusts presided over by Ramdev run 34 companies and there are allegations that he may have diverted donations from the trusts to create profit-making ventures. According to a source who wishes to remain anonymous, the ED is planning to bring Ramdev under the scanner for foreign exchange and money laundering violations. After the police crackdown on Ramdev and his followers on 5 June, the focus is now on exposing the truth behind the Baba’s empire. If the investigation reveals any underhand dealings in the various trusts based in Haridwar, the ED can initiate legal proceedings under the Foreign Exchange Management Act, 1999 (FEMA) or the Prevention of Money Laundering Act, 2002.
On 21 June 2011, the agency had written to the chief general manager, Foreign Exchange Department, Reserve Bank of India (RBI), asking for details of Ramdev’s trusts and the companies run by his associates — Acharya Balkrishna and Swami Muktanand. The letter intimated that the Delhi wing of the Directorate would probe the dealings of Ramdev’s trusts and companies under FEMA.
According to the ED, the worth of these trusts is Rs 1,100 crore. While three are based in India, one is in Scotland and the other in the US. The ED has attached a list of the trusts with the letter to the RBI. The trusts based in India include the Divya Yogpeeth Trust in Haridwar, the Patanjali Yogpeeth Trust and the Bharat Swabhiman Trust. Ramdev is the head of the Divya Yogpeeth trust established in January 1995 and Balkrishna is his second-in-command. At the time of its formation, the property of Swami Shankar Dev, guru of both Ramdev and Balkrishna, was incorporated into the trust. In 2007, the Swami mysteriously disappeared without a trace. Followers of Shankar Dev who were holding senior positions in the trust were gradually ousted by Balkrishna.
After the success of Divya Yogpeeth Trust, Ramdev and Balkrishna formed the flagship Patanjali Yogpeeth Trust. The head and secretary of this trust are Ramdev and Balkrishna respectively while Swami Muktanand is its treasurer.
In 2006, Ramdev formed the foreign wing of the Patanjali Yogpeeth Trust in Glasgow, UK, and the Patanjali Yogpeeth Foundation in the US in 2008. The ED is looking to closely scrutinise the income, donations and expenditure of these trusts. In its letter to the RBI, the ED has stated and listed 34 companies that form a part of his yoga empire. The directors of all these companies are his close aides. The letter claims some companies are also involved in export and import activities.
The headquarters of all these companies is the Patanjali Yogpeeth in Haridwar. Companies in the list include the Haridwar- based Patanjali Ayurveda Ltd, Vedic Broadcasting Ltd, Patanjali Food and Herbal Park Ltd, and the Jharkhand-based Mega Food Park Ltd. The ED letter is accompanied by another list of 11 companies that are associated with the treasurer Muktanand. Each of these companies has either Balkrishna, Muktanand, Ramdev’s brother Rambharat or his brother-in-law Acharya Yashadev Aryashastri as a director. All banking transactions of the trusts were executed by any two of the three trustees: Ramdev, Balkrishna or Muktanand.
Ramdev has desisted from revealing any financial details of the 34 companies managed by Balkrishna
The titles of the companies in the list seem to suggest they were involved in businesses like ayurvedic medicines, media and broadcasting, biscuit manufacturing, packaging, garment manufacturing, transport, construction, textiles, energy, bio research, etc. An interesting aspect about these companies is that some of them have almost similar names. The distinction is just a single word — Herbo-Yoga Village Pvt Ltd and Herbo-Yoga Pvt Ltd — in names of two different companies. In a recent interview, Ramdev had explained the proliferation of his yoga empire thus: “These companies have been formed in accordance with the rules of the land and through them, the rural poor in India are earning their livelihood.”
THE ED’S letter also mentions the island gifted to Ramdev by the Glasgow-based couple Sunita and Sam Poddar. Acquired by the Poddars for Rs 16 crore in 2009, this 900-acre island was originally called Little Kumra. Ramdev has now named it Shanti Dweepam. The investigating agency is also looking into the expenditure and income accrued to Ramdev from the various yoga camps he organises in foreign countries. The ED has sought details of all such foreign transactions by the Baba, his trusts and associates under FEMA.
On 21 June 2011, the ED wrote to the head office of the Punjab National Bank to inform them of the probe, and sought information pertaining to the the loans sanctioned to the companies and trusts. The collection accounts, current accounts and fixed deposits belonging to Ramdev and his associates will also be probed. This includes the facility of foreign exchange granted to the trusts, companies, directors and shareholders as well as details of import-export over the past five years.
Ramdev’s trust earns crores every year through donations and offerings. Following the recent controversy over the assets of his yoga empire, he had made the balance sheets of all his trusts public by putting them up on his website. However, the yoga guru has desisted from revealing any financial detail of the 34 companies managed by Balkrishna and his associates.
The ED’s report will likely shed light on the working of these companies. Even if some dirt does emerge on Ramdev, which would be a slap in the face of the self appointed crusader, the government itself will have some uncomfortable questions to answer. While an assessment of such a massive empire, with a complicated web of trusts and companies, is well within the ED’S purview, it is the timing that is bound to raise eyebrows, coming on the back of the crackdown on Ramdev’s Delhi agitation. Even if the inquiry throws up evidence of dirt, there will be a huge question mark of credibility attached to any criminal investigation that may follow.