Hyderabad: Gold worth Rs 2,700 crore imported into city post-demonetisation

Post the Narendra Modi-government's surprise decision to ban currency notes of Rs 500 and Rs 1,000, investigations by Enforcement Directorate (ED) have revealed that gold biscuits worth Rs 2,700 crore in cash was purchased using demonetised currency last month in Hyderabad alone.

According to a report in the Times of India, sources in the ED office said about 8,000 kgs of gold was imported into the city between November 8-30.  

"That all this was sold can be ascertained from the fact that there was fresh import of Rs 1,500 kgs of gold between December 1 and 10. There is a sudden spurt in the bullion market and those with high stash of the demonetised currency are buying gold from bullion traders and jewellers in Hyderabad," the above mentioned sources told the Economic Times. 

At present, the Income Tax department and ED officials are investigating whether gold traders accepted old cash, and if so, it would have been against the rules. The officials are suspecting foul play in the sale of gold in large quantities. Musaddilal Jewellers in Hyderabad claim they had received demands in advance payments. They sold gold to 5,200 customers and made Rs 100 crore and the business transaction took place between November 8-9.

ED sources told the publication that Musaddilal jewellers deposited about Rs 100 crore in the bank and transferred the same amount to four bullion traders. According to the sources, gold worth Rs 100 crore could have been sold in few hours when PM Narendra Modi announced the ban on Rs 500 and Rs 1000 currency notes on November 8. 

"We noticed that efforts were made to erase CCTV footage in the jeweller's shop. When we verified CCTV footage of neighbouring shops, there is no record of customers entering Musaddilal jewellers that night," sources said. Going by details of air cargo pertaining to gold imports, more than 8,000 kgs of gold was imported in November. 

In Hyderabad, gold as bullion is reportedly imported into the city through firms such as Diamond India, State Trading Corporation, MMTC, Axis Bank, Indus Ind, Yes Bank, ICICI, HDFC and Kotak Mahindra.