RBI can go ahead with auction of ₹4K-cr HDIL assets: EOW

The bank now awaits approval from court, response from Wadhawans

The economic offences wing (EOW) of Mumbai Police recently told a city court that it has no objection to properties worth ₹4,000 crore being auctioned in the case of the ₹4,355-crore fraud at Punjab and Maharashtra Co-operative (PMC) Bank. These properties were provisionally attached during the investigation and belong to real estate development firm, Housing Development and Infrastructure Limited (HDIL), and its promoters Rakesh Kumar and Sarang Wadhawan. The Wadhawans are among the key accused in the fraud and currently in judicial custody. The process of evaluating the properties is underway.

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Since September, an administrator appointed by the Reserve Bank of India (RBI) has been in charge of PMC Bank, where restrictions have been imposed by the RBI. Last week, the RBI had sought a no-objection certificate (NOC) from the EOW, to auction the mortgaged properties as per the provisions of the Securitisation and Reconstruction of Financial Assets and Enforcement of Securities Interest (SARFAESI) Act.

A senior EOW officer said the EOW has requested the court to remove the properties from attachment so that the RBI-appointed administrator may auction them. “We are expecting a final nod from the court on November 13. Once the court grants permission, a formal permission will also be taken from commissioner of police Sanjay Barve, and then the base price of the properties would be fixed,” he said. The court will now give notice to the Wadhawans who will have 60 days to respond. Earlier in October, the Wadhawans had written to the authorities, asking them to sell their attached assets so that proceeds from the sale may be adjusted against HDIL’s unpaid loans.

HDIL mortgaged several properties with PMC Bank, including large tracts of lands in Palghar and Sindhudurg districts. Among the attached moveable properties are a yacht, two aircraft and 14 vehicles. While these were not mortgaged with the bank, the Wadhawans have consented to them being sold in order to repay PMC Bank.

A valuer, appointed by the administrator, has started the process of valuing the properties in order to a base price for the auction.