Mumbai: In the multi-crore Punjab National Bank (PNB) fraud case wherein economic fugitive Nirav Modi is a key accused, the Prevention of Money Laundering Act’s (PMLA) special court has allowed the plea of PNB and ICICI Bank for fresh valuation and subsequent auction of diamantaire Mehul Choksi’s immovable commercial properties to recover the losses.
The two bank had approached the special court for the restoration of properties of Choksi’s four firms – Gitanjali Gems Limited, Nakshatra Brands Limited, Nakshatra World Limited and Gili India Limited.
Choksi was first booked by the CBI for cheating PNB by fraudulently obtaining a letter of understanding. Later, the Enforcement Directorate (ED) initiated a money laundering probe against him. Choksi’s three companies – Gitanjali Gems, Gili India Ltd and Nakshatra Brands – fraudulently obtained letters of undertaking (LoUs) worth Rs 3,011.39 crore and received the limit of foreign letters of credit (FLCs) enhanced to Rs 3,086.24 crore.
The ED has so far attached properties worth more than Rs1,200 crore linked to Choksi, many of which were mortgaged with the two banks from where Choksi had obtained the credit facilities.
The banks said since the recovery proceedings under the PMLA have been delayed and pending since November 2022, it would affect the recovery of public money. They have also argued that the value of the properties may decrease due to general wear and tear.
On January 3, the banks met ED officials and agreed that the properties be auctioned and the outcome be deposited in the form of fixed deposit accounts in the name of the court. The banks approached the court with the same proposition.
The court accepted the proposal and ordered that fresh valuation of properties be carried out and auctioned with due process. After deducting the cost incurred by the agency in the process of valuation and auction, funds gathered should be deposited in the bank accounts in the name of the court, which would subsequently order the distribution of these funds.
