PNB scam: Court allows auction of properties owned by Mehul Choksi's firm

Judge S M Menjoge of the special court held that if the properties are kept idle without maintenance then it will definitely reduce the value

A special court in Mumbai on Thursday allowed the auction of 13 properties of Gitanjali Gems Limited, a firm of fugitive diamond trader Mehul Choksi, the prime accused in the Punjab National Bank (PNB) loan fraud case.

Judge S M Menjoge of the special court hearing cases related to the Prevention of Money Laundering Act (PMLA), while allowing the official liquidator's plea, held that if the properties are kept idle without maintenance then it will definitely reduce the value. 

  These properties are: seven flats in Kheni Tower in Mumbai's Santacruz, a commercial unit in Bharat Diamond Bourse, four office units at Diamond Park in Gujarat's Surat and a shop there. The liquidator had last week moved a plea, seeking to get a valuation of these properties which are not secured and later sell them by way of auction.  The Enforcement Directorate (ED), in its response, had said that it has no objection if the plea was allowed. The court then ruled that after undertaking the valuation process, the liquidator is allowed to auction the unsecured properties which are held by Gitanjali Gems Ltd. It said the liquidators be allowed to open fixed deposits with ICICI Bank with respect to sale proceeds from the sale of assets. The sale proceeds deposited in the form of fixed deposits (FDs) will be in favour of this court, the special judge said. Choksi has been staying in Antigua since 2018 after leaving India.  His lawyer recently informed the court that Choksi is suspected to be suffering from cancer and is undergoing treatment in Belgium. Choksi, his nephew - fugitive diamond trader Nirav Modi - their family members, employees, PNB officials and others were booked by the ED and the Central Bureau of Investigation (CBI) in 2018 for perpetrating the alleged loan fraud at the Brady House branch of the PNB in Mumbai. It was alleged that Choksi, his firm Gitanjali Gems, and others "committed the offence of cheating against PNB in connivance with certain bank officials by fraudulently getting the LoUs (letters of undertaking) issued and got the FLCs (foreign letter of credit) enhanced without following prescribed procedure".  The anti money-laundering agency filed three charge sheets against Choksi till now. The ED in 2019 told the Bombay High Court that Choksi was a "fugitive and absconder".