The Enforcement Directorate (ED) on Thursday assured the Bombay high court that a plush triplex penthouse at Samudra Mahal in Worli, Mumbai, owned by fugitive diamond trader Nirav Modi — a prime accused in the Rs13,500 crore fraud at the Punjab National Bank (PNB), will not be auctioned before December 14.
The assurance came in response to a petition filed by Nirav Modi’s son Rohin, challenging confiscation of the property, claiming that it belonged to a Trust settled in his name.
On June 8, 2020, a special PMLA (Prevention of Money Laundering Act) court in Mumbai has ordered confiscation of Nirav Modi’s movable and immovable properties worth Rs1,396 crore.
The order has come on an application filed by ED under provisions of the Fugitive Economic Offenders (FEO) Act, 2018, and the properties to be confiscated include Modi’s bank balances in India and England, as also his immovable properties in India, UAE and England.
Rohin’s counsel, advocate Amit Sibal, submitted that the Samudra Mahal property did not belong to any individual, but to Rohin Trust. He added that provisions of the FEO Act require notices to be issued to every interested person before ordering confiscation of any property.
But, no notice was issued to Robin, although he is the beneficiary of the Rohin Trust and the order was passed without granting him an opportunity of hearing.
Sibal submitted that the Samudra Mahal property could not be labelled as “proceeds of crime” as it was bought in 2006 whereas the alleged crime — the massive fraud at PNB — was committed 2011 onwards.
ED’s counsel, advocate Hiten Venegaonkar, said that Rohin is only 10℅ beneficiary of the Trust and its major beneficiaries were his parents, and one of them — Nirav Modi — was declared a fugitive offender by the special court in December 2019.
Also, Venegaonkar said, the petitioner was minor at the relevant time and his father and natural guardian was represented before the special court, so Rohin cannot claim that he was not represented or heard before passing of the confiscation order.
The ED’s lawyer then requested the court to defer the hearing till December 14. Venegaonkar then assured the court that “nothing will happen” as regards the property till December 14.
On January 31, 2018, the Central Bureau of Investigation has registered an offence under various sections of the Prevention of Corruption Act and the relevant provisions of the Indian Penal Code against Modi and several others, including two officers of the PNB.
According to the complaint lodged by PNB, between February and May 2017, Nirav Modi and his partnership firms got fraudulently issued 150 Letters of Undertaking (LOUs) from Brady House branch of PNB and duped the public sector bank to the tune of USD1,015.35 million, equivalent to Rs6,498.20 crore.
A similar offence is registered against Mehul Choksi for duping PNB of crores of rupees by using the same modus operandi.