INDIA. Mumbai: The Special CBI judge SM Menjoge allowed the Enforcement Directorate (ED) to confiscate 39 properties worth around Rs 500 crore standing in the name of fugitive diamantaire Nirav Modi wanted in connection with multi-crore PNB fraud on Thursday.
However, the judge noted that the Punjab National Bank (PNB) was interested in a Singapore bank account owned by Nirav Modi’s sister Purvi and her husband, Mainak Mehta.
Besides, it was also interested in 8 other properties. As such, except for these properties, the rest of the properties can be confiscated by the ED, the judge said.
Nirav Modi was declared as a Fugitive Economic Offender on December 5, 2019. As such, ED counsels Advocates Hiten Venegaokar and Arvind Aghav, appearing for ED, argued for confiscation of Modi’s 48 properties, valued at Rs 929 crore, under the Fugitive Economic Offenders (FEO) Act.
They pointed to the estimated proceeds of crime, as mentioned in the case, was approximately Rs 6498.20 crore.
The properties to be attached include 12 immovable properties attached to the Rhythm House at Kalaghoda in South Mumbai, consignments seized by agencies in transit, money parked in bank accounts outside the country, and valuables seized from Modi’s Alibaug bungalow (Raigad district, Maharashtra) including 22 cars.
Modi has 16 stores in diverse locations such as Delhi, Mumbai, New York, Hong Kong, London, and Macau. He is currently in the United Kingdom and is seeking political asylum in Britain. Modi’s uncle Mehul Choksi is in Dominica.
The charges of his illegal entry into Dominica were dropped by a Dominical court in May last year.
In the first confiscation order under the FEO Act in 2020, the court had directed that the ED attach the properties of Modi.
However, it had exempted properties secured to PNB and a consortium of banks either through mortgage, hypothecation, or personal guarantee.
The lawyer for the PNB stated a huge amount of loan was granted to Modi and his companies. It is public money, and because of non-payment of the loan amount, the bank’s financial condition has been adversely affected.
The Debt Recovery Tribunal (DRT) has passed an award in favor of banks, and if the government confiscates properties, then nothing will be there to execute the DRT Awards.
The PNB scam relates to a fraudulent letter of undertaking worth Rs 10,000 crore issued by the bank. The key accused in the case were jeweller and designer Nirav Modi, his maternal uncle Mehul Choksi, and other relatives, and some PNB employees.
Nirav Modi and his relatives escaped India in early 2018, days before the news of the scam became public. The PNB scam has been dubbed as the biggest fraud in India’s banking history.