India's financial crime-fighting agency said on Saturday it had raided three premises linked to education platform Byju's and its billionaire chief executive Byju Raveendran over suspected breaches of foreign exchange laws.
The Enforcement Directorate said it seized various documents and digital data during the search, and had issued summons for Mr Raveendran, but he did not appear.
Byju's is one of India's biggest start-ups, once valued at $22 billion. It has attracted global investors such as General Atlantic, BlackRock and Sequoia Capital, which have invested in the company over the years.
The searches under alleged foreign exchange law violations revealed that Think and Learn Private Limited, Byju's parent firm, had received foreign direct investment of nearly 280 billion rupees ($3.43 billion) during the period from 2011 to 2023, the Enforcement Directorate said.
A representative for Byju's said the visit by directorate officials to one of the company's offices in Bengaluru was related to a routine inquiry under foreign exchange laws.
"We will continue to work closely with the authorities to ensure that they have all the information they need, and we are confident that this matter will be resolved in a timely and satisfactory manner," they said.
The searches come at a time when Indian start-ups have struggled to raise funds and been questioned by investors over their high valuations.
We are confident that this matter will be resolved in a timely and satisfactory manner
Byju's representative
The platform saw its usage swell during the pandemic, but announced the layoff of 2,500 of its 50,000 employees as educational institutions resumed in-person classes. The company reported a loss of 45.64 billion rupees in May for fiscal 2021.
Byju's spent $2.5 billion in the fiscal year ended on March 2022 to acquire companies such as Aakash, US-based Epic, children's coding platform Tynker, professional education firm Great Learning and exam preparation platform Toppr.
New York-based investment firm BlackRock, in a private assessment last month, slashed its valuation of Byju's by almost half to $11.15 billion.
The statement issued by the Enforcement Directorate said the company remitted 97.5 billion rupees to various foreign jurisdictions between 2011 and 2023 in the name of overseas direct investments.
The agency said Think and Learn had not prepared its financial statements since the financial year 2020-21, nor had its accounts been audited.
Byju's representative said the company had provided authorities with all the information they requested.
"We have nothing but the utmost confidence in the integrity of our operations," they said.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
