A special court hearing the fraud case against fugitive diamantaire Nirav Modi has ordered to release 18 properties belonging to him worth Rs 71.16 crores (USD 8,538,780) to the Punjab National Bank.
PNB has lost a large amount of money to the LOU fraud by Modi and his uncle Mehul Choksi. These properties were attached by the Enforcement Directorate and were to be confiscated under the fugitive economic offenders act.
The properties attached by ED
These 18 properties include, valuables of Modi’s firms received from Hong Kong, valued at ₹22.69 crores (USD 2,722,666); valuables received from Dubai, valued at ₹18.76 crore (USD 2,250,925); display stock of 16 pieces of jewellery at Four Seasons hotel valued at ₹35.52 lakh (USD 42,621); an office space in Kohinoor City, Kurla along with covered car parking spaces in lower basement valued at ₹24.63 crore (USD 2,954,254); and eight vehicles, including Bentley, worth Rs 26 lakh (USD 31,198), Force Motor Traveller worth ₹9.80 lakh (USD 11,759) and Alto at ₹2.25 lakh (USD 2,699).
The bank had moved a plea before the special court seeking to exempt these 18 properties of all the other seized properties which the Enforcement Directorate intends to confiscate under FEO law. The bank claimed that it has suffered huge losses and these properties were part of the mortgaged properties.
How Modi defrauded PNB
The court noted that ED’s complaint describes a series of incidents by way of which Nirav Modi and certain firms/cos/entities controlled by him including Solar Exports, Diamond R US, and Stellar Diamonds have defrauded PNB to the tune of more than ₹70,290,687,950 (USD 843,385,631).
Besides the agency claimed the previous order of release of properties which were not mortgaged or presented to bank as security, to bank. However, the court noted that the present properties were mortgaged by Modi’s firms and hence, they can be released to bank to cover their losses.
Modi becomes a fugitive economic offender
After Modi was declared fugitive economic offender, ED had sought to confiscate properties valued at ₹1,396.07 crore, which it claimed was purchased or owned by him using proceeds of the crime. The court had been now hearing the parties who can have claims over these properties before they are confiscated to National treasury.
Modi was declared FEO under the new law on December 5, 2019, after which the court began the process to confiscate his properties. The court refused to permit him to intervene in the process, but allowed banks to be heard.
(The article is published under a mutual content partnership arrangement between The Free Press Journal and Connected to India)