The parent company of Blackburn Rovers, Venky's London Limited (VLL), have been entangled in Venkateshwara Hatcheries Private Limited (VHPL)'s row with the Indian government.

Last month, the Indian government seized assets worth £7.3million from VHPL, who are the parent company of VLL which owns Rovers.

That related to money used to purchase a luxury house in Lanashire in 2011. Venky's Overseas Limited, another company within VHPL, purchased the property 12 years ago from former captain Manchester United Gary Neville.

Now, a second order has been made by India's Enforcement Directorate (ED) to seize £2.3m of assets as part of 'an investigation relating to alleged violation of the foreign exchange law' surrounding funds used by VLL in regards to Blackburn Rovers.

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It's alleged that money used by VLL to subsidise losses made by Rovers has also been used to purchase 53K shares in a Canadian entity, also co-owned by American signer Akon. It's stated that £3.3m was invested and the Bank of India were not informed.

The statement says: “VHPL declared the business of VLL to RBI (Reserve Bank of India) as engaged in recreation activity in the form of running a football club named Blackburn Rovers Football Club PLC (BRFC).

“After the incorporation of VLL, VHPL remitted huge funds in the guise of equity infusion. Apart from mis-declarations in the remittances, VHPL wrongly claimed these remittances as equity infusion in its wholly owned subsidiary, but in reality, the intention was to siphon off huge amount to an unrelated loss making entity."

In layman's terms, the Bank of India allege that money they thought was being used to subsidise Blackburn Rovers has been invested elsewhere, breaking tax laws. As a result of this investigation, the ED has now sezed a further £2.3m of assets from VHPL. 

The Lancashire Telegraph understands that Blackburn Rovers are confident this is an owner-related investigation and will not impact the club directly. The matter is handled by the Venky's in India.

Changes to tax laws in India have affected Rovers throughout the summer, with the wage bill cut by 15 per cent in June. The club did go on to sign two players for undisclosed fees but there remain huge question marks about how much Venky's can invest in the club moving forward.

Director of Football Gregg Broughton admitted that he's had no assurances about when the geopoliticial issues in India will be resolved. He did insist that the owners have stated they do not want to sell the club.

"The owners have been very clear, they do not want to sell the football club," Broughton told The Lancashire Telegraph in September. "They are committed to the project, committed to the football club.

"They have shown they can ride through the difficult situation they're having with India. They are fully supportive of us financially, they have to support the club to the tune of around £20million per year and they are fully committed to that."

VHPL announced a long-term multi-million-pound shirt sponsorship in July to put further funds into the club. CEO Steve Waggott said the deal would 'open many exciting opportunities for both businesses and demonstrates the owners’ unwavering determination to help the club progress strategically'.

After the initial story about assets being seized last month, a Blackburn Rovers spokesperson said: “In response to recent speculation regarding its finances, the club wishes to reiterate that it has received all the necessary undertakings from the parent company, VHPL, as it always has done, to be able to meet its financial obligations for the foreseeable future, in satisfaction of all the regulatory requirements in this regard.”