Pandora Papers Part 15: For Yachts and Real Estate Abroad, UPL’s Shroff Brothers Go Abroad
VIKRAM SHROFF, one of the two sons of Rajju (Rajnikant) Shroff, the founder of the global Rs 38,694 crore pesticide producer UPL (formerly United Phosphorus Ltd), acquired companies in the British Virgin Islands to own a yacht and with his older brother Jaidev, set up a four-tier subsidiary structure for owning real estate in Dubai, recorded in the Pandora Papers studied by Indian express reveal.
Records show that Vikram Shroff, a British citizen, in June 2011 set up a company called Spider Investments Ltd in the Cayman Islands, to own a € 3.65million motor yacht named Robusto for personal and business use. charter. Spider Investments was incorporated through Trident Trust Company (BVI) Ltd, a business service company.
In July 2016, Trident Trust established another company called Blue Harbor Group Ltd in BVI with Vikram Shroff as beneficial owner and Harris Trustees Limited, a subsidiary of Trident Trust, registered in Saint Kitts and Nevis, as shareholder.
According to Blue Harbor’s incorporation form, the company was formed solely to own a $ 3.5 million yacht, which will then be exported to the BVI for “tax purposes.” Blue Harbor records are kept at the Trident Trust office in Cyprus. Vikram’s annual income is estimated at $ 1.5 million and his overall wealth is estimated at $ 40 million in the incorporation form.
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Jaidev and Vikram also own the companies BVI Gem Consulting Ltd and Legacy Investing SA, respectively. These two companies were incorporated in January 2013. While Gem Consulting of Jaidev owns JS Investments Ltd in the Jebel Ali (Jafza) free zone in the United Arab Emirates, Vikram only owns VS Investments Ltd in Jafza.
JS Investments and VJ Investments, in turn, own 50 percent each in another Jafza-based entity, VJS Investments Ltd (now Vesper Investments Ltd). VJS Investments Ltd is the owner of Dubai-based Prasadah Trading DMCC which, according to Pandora Papers records, was established to own properties in Dubai. All these companies were created in 2014 between February and September.
The records also show that Vikram Shroff is the beneficial owner of another BVI company, Lorena Asset Holdings Ltd, established in 2011 to hold bankable assets and investments. It was also created to hold a bank account and Vikram’s investment portfolio at Bank Julius Baer in Zurich. Lorena’s sole shareholder is another BVI entity, Louksor Limited, according to records.
Jaidev Shroff is the beneficial owner of Trenkore Investments Limited, a Cypriot entity that was re-domiciled in BVI in 2011. Shroff controls this company through Seychelles-based Vector Projects Ltd, according to the records.
Responding to a list of questions, Mishcon of Reya LLP, the law firm representing the Shroff Jaidev brothers said: “Jaidev and Vikram Shroff have worked exceptionally hard to build one of the largest companies in the world that has created jobs. and prosperity in India and around the world. . The Shroffs own a yacht, which is never used by the family except privately. It has never generated any income, is not used for charter and has no tax implications.
He added: “To ensure that their private assets and liabilities are recorded and tracked, Jaidev and Vikram have established companies for each of their investments well in advance of any deal. If this agreement is not concluded, the company is no longer useful and either remains dormant or is liquidated. If this goes ahead, Jaidev and Vikram are proud to comply with the global common reporting standard developed by the OECD in 2014. They send information to the relevant tax authorities and keep their tax returns up to date. The brothers do not reside in India, but wherever Indian source income is generated, they easily pay any taxes due. “
On January 22, 2020, the income tax administration raided the premises of the UPL after complaints of alleged tax fraud. In its FY2021 annual report, the company said IT had sent notices asking it to file revised tax returns for previous years.
“The company filed its tax return. In addition, the income tax service issued notices to the company calling for certain preliminary information. The company is in the process of responding to the above opinions and does not expect this matter to have significant financial or reporting implications, ”UPL said in the annual report.
UPL has also been mired in controversy after a whistleblower claimed to siphon off funds from developers as the company paid millions of rupees in rent to shell companies for properties previously owned by UPL’s global director Jaidev Shroff. . He denied any wrongdoing and said the UPL audit committee looked into the whistleblower’s complaint in 2017 and found no basis in the allegations.
(With contributions from Jayprakash Naidu in Mumbai)