New Delhi: Acting on powers provided to it by the Fugitive Economic Offenders Ordinance, the Enforcement Directorate (ED) is set to tighten the noose around jewellers Nirav Modi and Mehul Choksi, wanted for questioning in the Rs12,636 crore Punjab National Bank (PNB) fraud.
Persons familiar with the development said on condition of anonymity that the agency was set to move the PMLA (Prevention of Money Laundering Act) court in either Delhi or Mumbai for permission to accord “fugitive" status to both Modi and his uncle Choksi.
While the ED has provisionally attached assets worth Rs7,600 crore belonging to Modi and Choksi, confiscation awaits court permission.
“Once the court gives the green signal, they will be proclaimed fugitives and their assets will then be confiscated by the Indian government. As of now provisional attachments only prevent them from selling their assets, but it is still in their name. However, once the PMLA court acts upon the ED’s plea, their properties will be seized by the government," the person said.
However, the procedure requires a chargesheet to be filed against the accused, along with the issuance of a non-bailable warrant (NBW). While the ED was given the go-ahead by the PMLA court in Mumbai to issue NBWs against both, a chargesheet is yet to be filed.
The ordinance aims to bring to task suspected economic offenders who flee India and do not return to face trial. It gives the government powers to confiscate property both within and outside India — whether or not the properties have been purchased from the proceeds of crime.
It also covers a wide array of white collar offences that can lead to an individual being classified as an economic offender. Serious violations of tax laws, including the goods and services tax, customs and excise, anti-black money law and benami property transactions could see provisions of this bill kick in. The amount involved has to be more than Rs100 crore for the law to apply.
While Modi’s lawyer Vijay Aggarwal declined to comment on the matter, Choksi’s lawyer said they were not unduly worried about the move.
“This is just an ordinance and not an act. Once it becomes a Fugitive Economic Offenders Act, we will see what is to be done. As of now, we are not worried. My client cannot join investigations either, as of now, because of his health reasons and we have informed the investigating agencies of the same," Sanjay Abbott, Mehul Choksi’s lawyer told Mint.
The ED has also been probing liquor baron Vijay Mallya in the Rs9,000 crore Kingfisher Airlines scam. In August 2017, it stated that it planned to sell a large portion of unpledged shares owned by Mallya in United Breweries (UB Group), to help it recover more than half the money owed by Mallya to banks and other lenders.
Earlier this week, the ED moved PMLA court to begin proceedings in order to seize Mallya’s assets. The agency had earlier provisionally seized assets worth Rs9,000 crore belonging to Mallya.
Mallya’s spokesperson did not immediately respond to Mint’s email seeking a response.
Remya Nair contributed to this story