ED to seek permission for “immediate confiscation” of Nirav Modi assets

Vastavam web: The ED is set to move a special court in Mumbai to seek permission for “immediate confiscation” of about Rs 7,000 crore assets of designer diamond 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 May 24, the ED had filed its first charge sheet in the over USD 2 billion PNB fraud case involving diamantaire Nirav Modi and his associates stating that over Rs 6,400 crore of bank funds were allegedly laundered abroad to dummy companies by him and others.The court is expected to take cognisance of the 12,000 page charge sheet tomorrow 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 told PTI.

A court-issued non-bailable warrant is already pending against Modi and the ED has also moved the Interpol to get a global arrest warrant issued against him, sometime back.The central probe agency had recently begun the work to bring together the existing cases of high-value fugitives and bank loan defaulters for getting them notified under the new legislation.

As per 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 a long time of 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.The Fugitive Economic Offenders Bill, 2018 was introduced in the Lok Sabha on March 12 but couldnt be taken up due to logjam in Parliament over different issues.

With Parliament being adjourned sine die, an ordinance was proposed.The Union Cabinet on April 21 approved the ordinance and the President gave his assent to promulgation of the same a day later.The ordinance makes provisions for special courts under the Prevention of Money Laundering Act, 2002 to declare a person as a fugitive economic offender.However, only cases of frauds, cheque dishonour or loan default of over Rs 200 crore would come under this ordinance.

The ordinance provides for necessary constitutional safeguards in terms of providing hearing to the person through counsel, allowing him time to file a reply, serving notice of summons to him, whether in India or abroad and appeal before the high court.The government had said the new law would help banks and other financial institutions to achieve higher recovery from financial defaults committed by fugitive economic offenders, improving the financial health of such institutions.Nirav Modi, who is absconding and has not joined the ED probe in the case till now, and others are being probed under various criminal laws after the fraud came to light this year following a complaint by the Punjab National Bank that they allegedly cheated the nationalised bank to the tune of over Rs 13,000 crore, with the purported involvement of a few employees of the bank.