Adani Group says the issue “stands closed” after clarifications, but officials told Reuters that the company admitted to import misclassification during inquiry.
BY PC Bureau
New Delhi: October 7, 2025: The Directorate of Revenue Intelligence (DRI) is probing Adani Enterprises’ defence unit for allegedly evading import taxes on missile components — the latest in a series of regulatory challenges for the conglomerate led by billionaire Gautam Adani, two government officials with direct knowledge told Reuters.
The probe by India’s Directorate of Revenue Intelligence (DRI) began in March 2025 and concerns alleged evasion of duties worth ₹770 million ($9 million). Officials say Adani Defence and Aerospace misclassified imported missile components as parts exempt from customs and local taxes, even though they were subject to both under prevailing rules.
Adani Defence, one of the smaller verticals in the coal-to-airports group, manufactures missiles, drones, and small arms primarily for Indian security forces. The alleged amount — equivalent to over 10% of the unit’s 2024–25 revenue of $76 million and more than half its profit — is considered significant.
According to a report put out by Reuters, one official said Adani executives admitted during questioning that a misclassification had occurred, though the company has publicly denied any wrongdoing.
In a statement, Adani Group said, “The DRI sought clarifications based on its interpretation of customs rules, and we have provided the required documentation. The issue stands closed from our end.” The company did not say whether any duty payments were made to settle the matter.
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According to officials, the investigation concerns parts imported for short-range surface-to-air missile systems, which attract a 10% import tax and 18% local levy. The company allegedly declared them as parts of long-range missiles, which were exempt from tariffs.
The DRI document reviewed by Reuters indicates that the imports involved non-explosive missile parts and launch mechanism accessories, primarily sourced from Russia, with shipments valued at around $32 million since 2024. Customs data shows Adani Defence has imported $70 million worth of defence parts from Russia, Israel, and Canada since January 2024.
Adani Group has pointed to a September 2025 government rule change that now allows all missile components — long or short range — to be imported duty-free. However, officials maintain that the earlier exemption did not cover the parts in question when the imports occurred.
The alleged duty evasion, if upheld, could expose the company to penalties doubling the amount, taking total liabilities to $18 million.
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This is not the first time the conglomerate has come under scrutiny. The DRI has been investigating Adani Group since 2014 for alleged over-invoicing of coal imports. Separately, the markets regulator SEBI recently cleared the company in two stock manipulation cases but continues to examine multiple other allegations.
The DRI has also issued similar notices in recent months to Samsung and Volkswagen over import misclassification cases, both of which are being contested.
Despite the ongoing probe, Adani’s defence arm continues to play a strategic role in India’s growing indigenous defence production network. In August, Gautam Adani announced that his company’s drones were deployed by the Indian military during the May conflict with Pakistan, underscoring the group’s expanding footprint in the defence sector.
If proven, the case could mark another regulatory setback for the Adani conglomerate, even as it seeks to project itself as a pillar of India’s industrial and defence self-reliance.
