The Serious Fraud Investigation Office (SFIO) and regional directors under the Ministry of Corporate Affairs (MCA) have given reports on 30 companies (and related parties) of Nirav Modi, main accused in the Rs 140-billion Punjab National Bank (PNB) fraud.
The government had ordered SFIO investigation into 107 companies and seven limited liability partnerships of Nirav Modi, uncle Mehul Choksi and related parties, he said. Some of these entities have been identified as shell companies.
READ MORE: PNB scam: Special court issues non-bailable warrant against Nirav Modi
The government recently referred a total of 19 cases to SFIO, mostly on Modi and Choksi, the minister said.
On the ICICI controversy, Chaudhary said the ministry ordered inspection under Section 206(5) of the Companies Act on April 23, with respect to six companies figuring in the matter. Under this section, the central government may authorise direct inspection of books and papers of a company by an inspector appointed by it for the purpose.
The ministry’s RD for the western region is doing the investigation.MCA had also ordered an SFIO probe into the affairs of Fortis Healthcare and Religare Enterprises. There were allegations that the promoters of these companies had siphoned off funds.
Various RDs of the office of the registrar of companies are investigating 49 cases of alleged shell companies and have presented 24 reports to the government. Prosecution is being mulled. The minister says the plan is to complete the process of issuing show cause notices to the second list of suspected shell companies by the end of this month.
In the first list of 300,000 suspected shell companies (the second list is of another 225,000), the tax department is probing for evasion. There are a total of 16,537 confirmed shell companies from the first list, on the basis of information from various law enforcement agencies. Plus a second list of 16,739 companies, identified on the basis of 100 per cent common directorships with the confirmed shell companies. A third ‘suspect list’ has 80,670 companies, prepared by SFIO on the basis of indicators in this regard.
The government said on Wednesday it was still examining the National Company Law Tribunal in the financial technologies case, wherein the MCA was permitted to appoint up to three nominee directors on the board.
On the recent Ordinance amending the Insolvency and Bankruptcy Code, the minister said the issue of treating homebuyers as secured or unsecured creditors was open-ended and a decision would be case-to-case. “Homebuyers will have to argue their own case as to whether they should be considered a secured or an unsecured financial
creditor,” he stated.
Further, he clarified that only the homebuyers who stake a claim at the time the resolution professional invites claims will get a share of the liquidation value of a defaulting company. Only individual homebuyers may resort to this.