Mumbai : The special FEO court clears the hurdle in bringing the money collected by auction of the property of Nirav Modi located in London, to India, whereby the special court has directed that the funds so received from the sale of the property shall be paid to the Government of India.
Nirav Modi was declared a fugitive economic offender on June 8, 2020 after he failed to surrender before the Indian prosecuting agencies which is probing PNBbank fraud case and money laundering case. Later, a month later on July 7, 2020, the court allowed Enforcement Directorate's plea to confiscate 68 properties valued at Rs 329.66 crores linked to Modi. This included, a house at London.
As per the Enforcement Directorate, the said house belonged to Modi and was 'illegally held by BVI Co.,103, Marathon House Ltd. having its address at Trident Chambers Tortola, British Virgin Islands within Trust Structure.' Such trust is called deposite trust under the law prevailing in UK.
While Indian agencies were pursuing the process for confiscation of Modi's properties, the said deposit trust moved a plea for winding up before the UK high court and obtained an order for disposal of Assets held by Trust which includes London property also. Later, in June 2023, the trust obtained an order to dispose off the property- London house. Though the Indian agency - Enforcement Directorate sought to intervene in the process of winding up of the trust to secure interest of Indian government over the funds so received from the disposal of the said property.
The Indian agencies faced difficulties to get the funds credited to the Government of India, in absence of a specific order to allow India to receive proceeds of sale or auction of these properties. The order passed by the court only mentioned about the confiscation of the properties of Modi. However, since it is to be executed in London, a specific direction was needed whereby the amount so received by disposal of the said property be credited or paid to Central government of India.
Legal advice
Besides, the law firm representing Indian agency before UK court advised that Indian agency may face trouble in recovery of the funds in absence of specific direction over proceeds of sale of the said property. In such situation, the agency's lawyer Arvind Aghav, moved an application before the special FEO court, for specific direction from the court expressing apprehension that the confiscation order would turn infructuous in absence of specific order and direction creating claim of Indian government over the funds so earned by auction, sale or any such disposal of the said property. Thus, special court, realising the necessity, made specific direction creating right of Indian Government to claim the funds.
The special judge, SM Menjoge so on March 30 passed the order clarifying that any funds so received from "sale, auction or in any form including winding up proceeding of said property be credited/paid to Central Govt. of India and Central Govt. of India shall be entitled to receive the same."
