 "ED to hand over Nirav Modi, Vijay Mallya properties to NBCC")
The Enforcement Directorate (ED) could soon hand over attached properties, including Nirav Modi and Vijay Mallya's, to state-owned construction company National Buildings Construction Corporation (NBCC), which will rent these out for commercial or residential purposes.
Business Standard has learnt the decision was taken earlier this week at a meeting in the finance ministry. Finance secretary Hasmukh Adhia chaired the meeting. ED director Karnal Singh and NBCC chairman Anoop Mittal attended the meeting.
The ED manages attached properties. There is no provision under the Prevention of Money Laundering Act (PMLA) for renting out of seized properties to earn revenue. The Act is expected to be amended soon to enable putting immovable assets on rent.
"The proposal is for managing land of around 25,000 acres, as well as over 300 establishments, including factories, flats, buildings and shops, which have been taken over by the ED," an NBCC official said.
"Our expenditure in maintaining the immovable properties we have seized runs into millions of rupees per annum. Once these are handed over to NBCC, we can free up those sums to be utilised elsewhere. Most properties remain unused," said a senior ED official.
The official said properties seized from raids related to the Rs 129-billion scam have not been attached yet. "As per the rules, the adjudicating authority has given 180 days to the person's lawyers to explain why the properties should not be attached. We are confident we have evidence to turn these seizures into attachments. After that, and once the contract with the NBCC is in place, we will hand these over," the official said.
The finance ministry, at the ED's behest, mooted the proposal about six months ago it felt lack of maintenance led to decay in these.
NBCC has a subsidiary for properties that it takes over from the government and other state-owned companies. NBCC will get 20 per cent from the rent and a commission from the auction, government sources said.
The company receives contracts from the ministries of home, finance, defence and others. A contract with the ED could lead to similar agreements with other intelligence or police establishments, NBCC sources said.
Business Standard has learnt the decision was taken earlier this week at a meeting in the finance ministry. Finance secretary Hasmukh Adhia chaired the meeting. ED director Karnal Singh and NBCC chairman Anoop Mittal attended the meeting.
The ED manages attached properties. There is no provision under the Prevention of Money Laundering Act (PMLA) for renting out of seized properties to earn revenue. The Act is expected to be amended soon to enable putting immovable assets on rent.
"The proposal is for managing land of around 25,000 acres, as well as over 300 establishments, including factories, flats, buildings and shops, which have been taken over by the ED," an NBCC official said.
"Our expenditure in maintaining the immovable properties we have seized runs into millions of rupees per annum. Once these are handed over to NBCC, we can free up those sums to be utilised elsewhere. Most properties remain unused," said a senior ED official.
The official said properties seized from raids related to the Rs 129-billion scam have not been attached yet. "As per the rules, the adjudicating authority has given 180 days to the person's lawyers to explain why the properties should not be attached. We are confident we have evidence to turn these seizures into attachments. After that, and once the contract with the NBCC is in place, we will hand these over," the official said.
The finance ministry, at the ED's behest, mooted the proposal about six months ago it felt lack of maintenance led to decay in these.
NBCC has a subsidiary for properties that it takes over from the government and other state-owned companies. NBCC will get 20 per cent from the rent and a commission from the auction, government sources said.
The company receives contracts from the ministries of home, finance, defence and others. A contract with the ED could lead to similar agreements with other intelligence or police establishments, NBCC sources said.
One subscription. Two world-class reads.
Already subscribed? Log in
Subscribe to read the full story →*Subscribe to Business Standard digital and get complimentary access to The New York Times
Smart Quarterly
₹900
3 Months
₹300/Month
SAVE 25%
Smart Essential
₹2,700
1 Year
₹225/Month
SAVE 46%
*Complimentary New York Times access for the 2nd year will be given after 12 months
Super Saver
₹3,900
2 Years
₹162/Month
Subscribe
Renews automatically, cancel anytime
Here’s what’s included in our digital subscription plans
Exclusive premium stories online
Over 30 premium stories daily, handpicked by our editors
Complimentary Access to The New York Times
News, Games, Cooking, Audio, Wirecutter & The Athletic
Business Standard Epaper
Digital replica of our daily newspaper — with options to read, save, and share
Curated Newsletters
Insights on markets, finance, politics, tech, and more delivered to your inbox
Market Analysis & Investment Insights
In-depth market analysis & insights with access to The Smart Investor
Archives
Repository of articles and publications dating back to 1997
Ad-free Reading
Uninterrupted reading experience with no advertisements
Seamless Access Across All Devices
Access Business Standard across devices — mobile, tablet, or PC, via web or app
SAVE 25%