PNB seeks control over properties of Nirav Modi to recover bank dues

The court last week declared Nirav Modi a fugitive economic offender under a special law. It will now begin the process of confiscation of his properties.

Charul Shah

The Punjab National Bank (PNB) filed an application before the special Prevention of Money Laundering Act (PMLA) court on Friday asking it to hand over the attached properties of diamantaire Nirav Modi to the banks to recover their dues. (HT Photo)

The Punjab National Bank (PNB) filed an application before the special Prevention of Money Laundering Act (PMLA) court on Friday asking it to hand over the attached properties of diamantaire Nirav Modi to the banks to recover their dues amounting to Rs 7,029.06 crore, instead of giving it to the Centre.

The court last week declared Nirav Modi a fugitive economic offender under a special law. It will now begin the process of confiscation of his properties. The application was moved on Friday, as the special PMLA court was scheduled to hear an application of the enforcement directorate (ED) to confiscate Modi’s properties located in India and abroad.

The banks pleaded that the mortgaged properties of the companies, Modi and his family members, who stood guarantor for these companies be handed over to two consortiums – one headed by PNB, which has 16 banks as members, and second headed by the Union Bank of India, which has nine banks as its members.

While the bank’s plea mentions Modi’s immovable properties, 69 bank accounts, and valuables, including cars, diamonds and jewellery, it does not mention its value.

The banks claimed they are victims of the fraud committed by Modi. “It will gravely harm the interest of claimants (banks) who have already suffered at the hands of the fugitive offender. The properties will be liquidated or utilised to repay the outstanding debts to the claimants. This fraud committed by the Fugitive Offender has caused huge loss of public monies and by exempting confiscation of the properties mentioned in the application and releasing the same to the claimants, same will recovered becoming a necessary boost to the economic health of the country in the long run,” read the plea.

The bank pleaded that the PNB and consortiums are ready to give any undertaking as required by the court. The bank also attached the notice issued by the debt recovery tribunal (DRT) in November last year, demanding Modi and his companies pay the dues amounting to Rs 7,029.06 crore.

The plea states the properties were accepted as securities on behalf of Firestar International Limited and Firestar Diamond International Limited, in whose name Modi obtained LoUs.