The Enforcement Directorate has confiscated eight flats and five car parking spaces of singer Adnan Sami in Mumbai and slapped a fine of Rs. 20 lakh on him for acquiring assets without permission of the Reserve Bank of India (RBI) as he was a Pakistani national.
The properties are located in Oberoi Sky Garden Housing Society in posh Lokhandwala complex in Andheri.
According to the ED sources, Sami acquired these properties in 2003 in violation of Foreign Exchange Management (acquisition and transfer of immovable property in India) Regulations, 2000.
Under these regulations, any person, who is a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, China, Iran, Nepal or Bhutan cannot purchase or transfer any kind of immovable property in India without taking permission of RBI.
The properties were confiscated following an order passed by Foreign Exchange Management Act (FEMA) adjudication authority.
Sami's lawyer Vibhav Krishna said: "We have received a copy of the order but the properties have not yet been confiscated. We have a right to appeal before the appellate forum of FEMA and we shall exercise this right within two days."
Sami had purchased these properties in 2003 for Rs. 2.53 crore. In 2008, he gifted five flats and three parking slots to his wife Sabah Galadari, a UAE national.
Later, his relations with Sabah turned soar and she filed a divorce case against him. Sabah claimed that the flats gifted by Sami now belonged to her, although he disputed her plea in the court, which declared their marriage null and void.
ED termed the purchasing of properties and transferring of five flats and three parking slots illegal and a violation of FEMA laws and confiscated the flats.
Sami was also asked earlier to show cause why flats and parking spaces should not be confiscated. He was also called for questioning early this year.
ED said that Sami had not taken approval of RBI to buy these properties and after acquiring them when he applied for the permission, the RBI had rejected his plea.
ED further claimed that Adnan Sami had misled banks by declaring that he was an Indian national while taking loans to buy properties.
Vibhav Krishna said the singer had taken a stand before the FEMA adjudication authority that RBI had powers to grant ex-post-facto permission to acquire the properties and such an application made by him is pending before the supreme court.
Krishna said Sami urged that till RBI decides his application, the authorities should not pass any order but his plea was rejected.
Sami pleaded that he had taken loans from Axis bank to buy these properties and there was no question of foreign exchange violation. Hence FEMA rules were not violated.
Sami urged that he may be allowed to cross examine the builder and two witnesses (Bank officers) who had given statements that they were not aware about his Pakistani national status.
He also told the FEMA adjudication forum that he had applied for Indian citizenship and his application was pending before authorities.
The singer pleaded that he had got a PAN card and was paying income tax in India since last ten years.