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Billionaire jewellery designer Nirav Modi is at the centre of the $2 billion PNB fraud. Photo: Mint
Billionaire jewellery designer Nirav Modi is at the centre of the $2 billion PNB fraud. Photo: Mint

PNB fraud: ED may confiscate Nirav Modi’s assets under fugitives law

The Enforcement Directorate will seek an official declaration to categorise Nirav Modi as a 'fugitive' based on its chargesheet filed before a special court in Mumbai last week under PMLA

New Delhi: The Enforcement Directorate (ED) is set to approach a special court in Mumbai to seek permission for “immediate confiscation" of about Rs7,000 crore worth of assets of jeweller Nirav Modi under the recently promulgated Fugitive Economic Offenders Ordinance.

The agency, empowered by the Union government to enact the new power in the country, will seek an official declaration to categorise Nirav Modi as a “fugitive" based on its prosecution complaint (charge sheet) filed before a special court in Mumbai last week under the Prevention of Money Laundering Act (PMLA).

On 24 May, ED had filed its first charge sheet in the over $2 billion Punjab National Bank (PNB) fraud case involving Modi and his associates stating that over Rs6,400 crore of bank funds were allegedly laundered abroad to dummy companies by him and others.

A total of 24 accused have been listed in the charge sheet, filed under Section 45 of the PMLA, including Nirav Modi, his father, brother Neeshal Modi, sister Purvi Modi, brother-in-law Mayank Mehta and the designer jewellers’ firms—Solar Exports, Stellar Diamonds and Diamonds R Us. The court is expected to take cognisance of the 12,000 page charge sheet on Monday and the counsel for the agency will subsequently seek its permission to invoke the provisions of the Fugitive Economic Offenders Ordinance against Modi and immediately begin the procedure to confiscate all the assets “of and linked to" Modi in India and abroad, a senior official said.

A court-issued non-bailable warrant is already pending against Modi and ED has also moved the Interpol to get a global arrest warrant issued against him. The agency will initiate the same action against absconding liquor baron Vijay Mallya, against whom the ED and the CBI had filed their respective charge sheets last year. It is expected, the official said, that assets worth Rs7,000 crore can be confiscated in the money laundering and the PNB fraud corruption case against Nirav Modi, under the stringent fugitive offenders ordinance.

The central probe agency had recently started work to bring together the existing cases of fugitives and bank loan defaulters for getting them notified under the new legislation. According to the existing process of law under the PMLA, the ED could only confiscate the assets once the trial in a case finishes which usually takes many years. The ordinance is aimed at deterring economic offenders from evading the process of law by remaining outside the jurisdiction of Indian courts. The Modi government brought the ordinance last month as “there have been instances of economic offenders fleeing the jurisdiction of Indian courts, anticipating the commencement, or during the pendency, of criminal proceedings," the government said.

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