Photo Credit: Business Standard
India’s leading FMCG company, Patanjali Ayurved Ltd., co-founded by yoga guru Baba Ramdev, is currently facing intense scrutiny from the Ministry of Corporate Affairs (MCA). The MCA has issued a formal notice to the company seeking detailed explanations regarding certain financial transactions flagged as suspicious and irregular by India’s economic intelligence agencies. This probe could mark a significant turning point for Patanjali, which has been under the spotlight for various regulatory issues over the past few years.
According to sources, the MCA’s investigation focuses on “abnormal and dubious” transactions within Patanjali’s books. While the exact monetary value of these transactions remains undisclosed, the company has been given a strict timeline of about two months to respond with clarifications and supporting documents. This action underscores the government’s growing vigilance over corporate transparency and financial propriety in the FMCG sector.
This isn’t the first time Patanjali has found itself embroiled in controversies. In 2024, the company faced legal challenges related to misleading advertising and unsubstantiated product claims. The Supreme Court directed Patanjali to issue a public apology and temporarily halted the licenses of certain products. Moreover, the brand has faced allegations concerning tax evasion and environmental compliance violations in its manufacturing units. Such incidents have kept Patanjali under continuous watch by various regulatory bodies, raising questions about its corporate governance standards.
Patanjali Ayurved’s rise as a dominant player in India’s FMCG market was meteoric, fueled by the growing demand for Ayurvedic and natural products. However, these regulatory hurdles and investigations into financial irregularities could impact its brand image and market share. Industry experts suggest that the outcome of the MCA probe may have far-reaching consequences for the company’s credibility and operations.
As this investigation unfolds, stakeholders including investors, consumers, and regulators will be keenly observing Patanjali’s response and the government’s next steps. The FMCG sector, known for fierce competition, may see ripple effects depending on how this high-profile case progresses.
