PNB fraud: Govt gets NCLT nod to attach properties of Nirav Modi, Mehul Choksi
Mumbai: The Mumbai bench of the National Company Law Tribunal (NCLT) on Friday evening allowed the government to attach 64 properties belonging to individuals as well as companies that are part of groups headed by Nirav Modi and Mehul Choksi and find mention in the complaint lodged by state-run Punjab National Bank (PNB).
A division bench of NCLT passed the ex parte order and posted the next date of hearing for 27 February.
Earlier in the day, the government had moved the NCLT to attach all properties owned by Modi and Gitanjali Gems Ltd promoter Choksi as well as assets of around 114 companies owned or controlled by them.
The ministry of corporate affairs sought the court’s intervention to attach properties owned by Modi, his wife Ami, brother Nishal and uncle Choksi, in India as well as abroad.
“The central government has formed an opinion that there are many (more) black sheep than it appears and the Serious Fraud Investigation Office (SFIO) will investigate into the matter, for which the government wants to attach all the properties owned by these four people along with their company assets,” argued joint legal director in the ministry of corporate affairs, Sanjay Shorey, who was representing the government before the tribunal.
“We want to attach all the assets of 114 companies related to the accused as well,” he added.
The government official further argued that the government is seeking ex parte relief in extraordinary circumstances because most assets owned by the Modi family and Choksi are in liquid form and the investigation cannot be taken forward without NCLT’s permission.
“These four people are prima facie beneficiaries of the fraud purported on their behest where more people from the Punjab National Bank are also involved,” said Shorey. “We want to freeze and attach all the properties (to prevent) alienating as well as creating any third-party interest on any of the property.”
Various government agencies, including the Enforcement Directorate, Central Bureau of Investigation and the Securities and Exchange Board of India, are looking into the matter. The ministry of corporate affairs is also seeking the help of the Central Board of Direct Taxes to ascertain the assets of the prime accused and other related parties.
“We are relying on an internal vigilance report prepared by the PNB and on the basis of that, we have zeroed in on these companies as well as properties owned or controlled by accused”, Shorey said, adding that the “government intends to attach the properties of accused in other countries as well through Indian missions abroad”.
According to Zulfiquar Memon, managing partner of law firm MZM Legal, “in the present case, the investigation agencies will look at each and every company, all their directors, their accounts as well as every transaction that companies have conducted. Currently, the case is at a very nascent stage and the details in the public domain are just the tip of the iceberg”.