The Enforcement Directorate (ED) on Tuesday (December 10, 2024) said it had initiated the return of properties to the rightful owners of assets worth ₹ 2,565.90 crore as part of a money laundering probe against absconding businessman Mehul Choksi.
The probe agency’s move was based on an order passed by a special PMLA court in Mumbai who directed the agency to liquidate properties and assets linked to Choksi after the court received an alleged fraud case petition from Punjab National Bank (PNB) and ICICI Bank.
The agency said, “On the basis of the application filed by the banks backed by the ED, the Special PMLA Court, Mumbai, allowed monetization of properties worth ₹ 2,565.90 crore held by the ED, Mumbai had been seized or seized in the Choksi PNB fraud case. In compliance with the order, the process of transfer of assets has been initiated and properties worth over ₹125 crore have been transferred to the liquidator of Gitanjali Gems Ltd.”
The transferred properties include six flats in Kheni Tower in Santacruz East in Mumbai worth around ₹27 crore and two factories and buildings located in Santacruz Electronic Export Processing Zone in Mumbai worth ₹98.3 crore. Restitution of the rest of the properties was also underway, the agency said.
Letters of credit
Investigation under the Prevention of Money Laundering Act (PMLA) in the Choksi case revealed that during the period from 2014 to 2017, he conspired with his associates and PNB officials and fraudulently obtained Letters of Undertaking and Foreign Letters of Credit from PNB, resulting in an unlawful loss of ₹6,097.63 crore to PNB. He had also taken a loan from ICICI Bank and had defaulted on that loan too.
During the investigation, the ED conducted searches at over 136 locations across India and seized valuables such as jewelery worth ₹597.75 crore related to Choksi’s Gitanjali Group. “Further, immovable and movable assets worth ₹1,968.15 crore of Choksi’s Gitanjali Group, including immovable properties in India and abroad such as vehicles, bank accounts, factories, shares of listed companies and jewellery, were seized. A total of assets worth ₹ 2,565.90 crore have been seized in this case and three prosecution cases have been filed,” an ED official said.
To expedite the process of restitution of properties to the victim banks, the ED along with the banks has taken proactive steps to monetize assets. They agreed to take a common stand and moved the Special PMLA Court in Mumbai to file a joint consent application. On September 10, 2024, the court passed the order based on the joint petition stating that the ED would facilitate the banks and liquidators of various Gitanjali Group companies in conducting the valuation and auction of the seized and attached properties. After the auction of the said properties, the sale proceeds would be deposited as fixed deposits with PNB and ICICI Bank.
Published – Dec 10, 2024 10:36 PM IST
