Hero MotoCorp bought electoral bonds worth Rs 20 crore shortly after IT raid, EC data reveals

Within months of an income tax raid, auto major Hero MotoCorp for the first time bought electoral bonds worth Rs 20 crore on October 7, 2022.

The company bought 20 electoral bonds worth Rs 1 crore each on a single day.

Officials of the income tax department had raided Hero MotoCorp in March that year.

The raids were conducted at Hero MotoCorp offices and the residences in Gurgaon, Haryana and Delhi of its promoters, including that of the chairman and CEO of the group, Pawan Munjal.

The income tax department, reports said, had collected evidence that revealed that Hero MotoCorp has booked bogus purchases, made huge unaccounted cash expenditures and obtained accommodation entries, aggregating to more than Rs 1,000 crore.

The department has also found over Rs 100-crore cash transactions for a farmhouse in Chhattarpur, Delhi, according to reports.

Hero MotoCorp had called the raids by the tax authorities a “routine enquiry”.

“We have been informed that this is a routine inquiry, which is not uncommon before the end of the financial year,” Hero MotoCorp had said in a statement.

It said the company is a “law-abiding corporate, with robust internal financial controls” and its “financial statements are duly audited”.

In November last year, the Enforcement Directorate (ED) had “provisionally attached” assets worth about Rs 50 crore belonging to Hero MotoCorp executive chairman Pawan Munjal in connection with a money-laundering investigation against him. These include three immovable properties (in the form of land) in Delhi, the central agency said.

The ED alleged that Munjal misused the Reserve Bank of India’s liberalised remittance scheme by illegally moving foreign currency and valuable items worth Rs 54 crore abroad and later using them for his personal expenses.

The quid pro quo link seems to be missing so far as data relating to buyer and beneficiary have been disclosed for most of the bond but who encashed the bond will only be known once the missing Unique Identification Numbers for electoral bonds – that link the buyer to the receiver – are revealed by the Election Commission of India.

Congress leader Rahul Gandhi described the electoral bonds scheme as an extortion racket to topple governments and break up political parties.