ED raids luxury car dealer’s residence, showroom in Hyd’bad

Hyderabad: The Enforcement Directorate (ED) has exposed one of the country’s most significant luxury car smuggling scandals of 2025 following high-profile raids on SK Car Lounge and its owner, Basharat Ahmed Khan, in Hyderabad.

The ongoing investigation has unearthed a complex web of international smuggling routes, high-profile buyers, and extensive customs fraud, resulting in losses to the exchequer estimated at tens of crores.

On Friday, 26 September 2025, ED officials raided Khan’s residence in Jubilee Hills and the SK Car Lounge in Gachibowli, the central hub for dozens of luxury vehicle transactions. Searches were also conducted at properties belonging to Khan’s family and associates in Hyderabad and Hakeempet. Investigators seized import ledgers, conversion invoices, and a list of “VIP” buyers. Initial estimates indicate a direct customs loss of Rs seven crore from undervaluation, though the total fraud is now believed to be closer to Rs 100 crore as more vehicles and buyers are identified.

Khan has been placed in judicial custody. The ED, working in conjunction with the Directorate of Revenue Intelligence (DRI) and customs authorities, continues to search properties and question associates, buyers, and workshop owners involved in the conversions and storage of these vehicles. Vehicle records, tax filings, and buyer payment trails are being meticulously cross-referenced with import documents sourced from Dubai, Sri Lanka, and various port authorities across India.

The case took a more intriguing turn when investigators discovered that the buyer list included several prominent figures, such as Shailima Kalavakuntla, wife of former minister KT Rama Rao and co-founder of AtHome Hospitality, Mohammed Sarib Rasool Khan, founder of Ayaan Educational Society, and numerous politicians and VIPs from multiple parties.

The investigation began with a tip-off to intelligence officer Susheel Choudhary regarding the systematic misdeclaration of luxury car imports linked to SK Car Lounge. Early probes by the DRI revealed that multiple cars were being imported at nearly half their actual value using falsified documents. In May 2025, the DRI arrested Khan in Surat, and he was subsequently presented before a special court in Ahmedabad for customs duty evasion amounting to Rs 100 crore.

The smuggling ring exploited global trade routes, sourcing high-end cars from the United States and Japan before rerouting them through Dubai and Sri Lanka. In these locations, the vehicles were converted from left-hand to right-hand drive to meet Indian regulations. Fake invoices and misdeclarations drastically reduced their appraised value for customs. The ongoing probe has so far identified nearly 30 such cars, including Rolls-Royce, Lexus, Toyota Land Cruiser, Lincoln Navigator, Cadillac Escalade, and Hummer EV models.

During questioning, Khan admitted to undervaluing specific models, including the Toyota Land Cruiser 300 (undervalued by Rs 20 lakh), the Rolls-Royce Cullinan (undervalued by Rs 1.24 crore), and the Lexus LX-500D (undervalued by Rs 50 lakh). Officials believe Khan’s method was consistent across all shipments. He has reportedly offered to pay the differential duties on eight of the cars currently under scrutiny.

Beyond sales, Khan is also known for lending these luxury cars to influential political and business figures for events and travel, often facilitating cash transactions that bypassed standard tax protocols. While investigators are probing the extent of political patronage and links, most of the implicated parties have denied any wrongdoing.

What began as a quiet tip-off has now escalated into a national scandal, implicating politicians, businesspeople, and cross-border networks in a massive luxury car smuggling operation.