In a significant move to expedite the recovery process for defrauded banks, the Enforcement Directorate (ED) has successfully facilitated the transfer of four high-value apartments in Borivali to a court-appointed liquidator. These properties were attached in the multi-crore Punjab National Bank (PNB) fraud case involving diamond trader Mehul Choksi.
Key Assets Transferred for Monetisation
The handover was officially completed on November 21, following a joint application by the ED and the victim banks to the Special PMLA Court in Mumbai. An official confirmed that the four flats, part of a Borivali real estate project, are now under the control of the liquidator. The primary objective is to monetise these assets, with the resulting funds being used for the benefit of the victim banks, secured creditors, and other legitimate claimants.
This is not an isolated action. So far, the ED has overseen the transfer of immovable and movable properties located in Mumbai, Kolkata, and Surat, with a collective worth of approximately Rs 310 crore, to the liquidator of Gitanjali Gems Ltd, the firm at the heart of the scandal linked to Mehul Choksi.
Coordinated Legal Effort for Restitution
The decision to move a joint application was a strategic one, born from an agreement between the ED and the banks to adopt a common stand. This collaboration was aimed squarely at accelerating the restitution of properties to the financial institutions that suffered losses.
Acting on this application, the Special PMLA Court issued a directive, ordering the ED to assist the banks and the liquidators of various Gitanjali Group companies. This assistance is crucial for carrying out the valuation and subsequent auction of all attached or seized properties. The court has mandated that the proceeds from these auctions be deposited as fixed deposits in PNB and ICICI Bank.
The Scale of the PNB Fraud
The ED's investigation under the Prevention of Money Laundering Act (PMLA) has uncovered a massive fraud scheme. It was revealed that Mehul Choksi, in collusion with his associates and certain officials of the Punjab National Bank, allegedly obtained Letters of Undertaking and Foreign Letters of Credit through fraudulent means.
This illicit activity took place between 2014 and 2017, ultimately causing a wrongful loss of a staggering Rs 6,097.63 crore to PNB. Furthermore, it was established that Choksi had also defaulted on a loan taken from ICICI Bank.
During its extensive probe, the ED conducted searches at more than 136 locations across India. These operations led to the seizure of valuables and jewellery worth Rs 597.75 crore belonging to the Gitanjali Group. In addition, the agency attached immovable and movable assets valued at Rs 1,968.15 crore.
This portfolio of attached assets is vast, comprising overseas and domestic properties, vehicles, bank accounts, factories, shares of listed companies, and jewellery. In total, assets worth Rs 2,565.90 crore have been attached or seized in this high-profile case, and the ED has filed three prosecution complaints to advance the legal proceedings.
