The Adjudicating Authority has held Kashmiri businessman Zahoor Ahmed Shah Watali guilty of contravening the Foreign Exchange Management Act (FEMA). He is already under investigation for alleged terror financing.
“After conducting the adjudication proceeding, the Authority has held the noticee guilty of violating FEMA provisions and imposed penalty to the extent of Rs.62 lakh in a case of operating Non-Resident saving accounts [NRE and NRO] with HSBC Bank in Delhi in an unauthorised manner,” said the Enforcement Directorate (ED) on Friday.
The proceedings against Watali were initiated on the basis of information about certain suspicious foreign exchange transactions.
“At the time of opening of these accounts, he had submitted a copy of a passport issued in Washington D.C., a resident visa and other documents, claiming that he was a Non-Resident Indian. However, he had neither remained outside India for more than 182 days in the preceding year, nor did he intend to remain abroad for an uncertain period,” said an ED official.
In 2003-09, he received about Rs.63 lakh in his NRE and NRO accounts despite residing in India, as alleged.
Money laundering probe by ED
The ED is also conducting a money laundering probe against the businessman, based on the National Investigation Agency's case of terror financing against Lashkar-e-Taiba chief Hafiz Saeed, Hizb-ul- Mujahideen head Syed Salahuddin and others.
The ED has attached properties worth Rs.8.94 crore of Watali and his family members in the case. He has been accused of raising funds and operating as a financial conduit for Hurriyat leaders. He, along with other nine accused, is currently in judicial custody at the Tihar Jail in Delhi.
It is alleged that the funds were used by secessionists to instigate the masses in the Kashmir Valley to stage violent protests and target security forces. This was done “wilfully” to create disaffection among the people of Jammu and Kashmir towards the Indian government, the Directorate had alleged.
According to the ED, the Hurriyat leaders received funds from Pakistan through conduits and also from the Pakistan High Commission in New Delhi.
“This was substantiated by an incriminating document seized from the house of Ghulam Mohammad Bhatt, who worked as cashier-cum-accountant with Watali. It clearly indicates that Watali was receiving money from Hafiz Saeed, the ISI and the Pakistan High Commission, as also from a source based in Dubai,” it said.
