Rs 2,566-crore properties of Mehul Choksi up for sale

An order by a PMLA court in Mumbai has paved the way for auctioning of Rs 2,566-crore worth of properties of fugitive businessman Mehul Choksi. These properties were attached by the Enforcement Directorate (ED) in the Rs 6,000-crore PNB bank fraud case.

The ED has already started the process of handing over the properties to the liquidator and assets worth Rs 125 crore have been handed over to the liquidator of Gitanjali Gems, the company once owned by Mehul Choksi.

“The handed over properties include flats situated at Mumbai and two factories/ godowns situated at SEEPZ Mumbai. Restitution of the rest of the properties is also in progress,” said the enforcement directorate in a press statement.

Mehul Choksi has been charged under the Prevention of Money Laundering Act (PMLA) for causing Rs 6,098 crore to Punjab National Bank (PNB) during the period from 2014 to 2017.  ED investigation also revealed that he had taken a loan from ICICI Bank and defaulted on that loan too.

During the investigation, ED had conducted searches at more than 136 locations all over India and seized valuables/jewelleries worth Rs 598 crore belonging to Gitanjali Group of Mehul Choksi. It also attached immovable/movable assets worth Rs 1968 crore in India and overseas.

The enforcement directorate has said that a concerted effort was put by ED in collaboration with PNB and ICICI Bank, and an application for restitution of assets was filed in the Mehul Choksi case.

To expedite the process of restitution of properties to the victim banks, ED along with the banks took proactive steps towards monetization of assets. The ED and banks agreed to take a common stand and moved the Special PMLA Court, Mumbai for filing a joint application. On 10^th September, the court passed an order on the joint application, wherein it was ordered that ED would facilitate the banks, liquidators in different Gitanjali Group of companies to carry out valuation and auction of the attached or seized properties.

Gitanjali Gems, which was once promoted by Mehul Choksi, went into corporate insolvency resolution process (CIRP) in 2018 and after three and a half years, the National Company Law Tribunal (NCLT) ordered liquidation of the company. The company had a total debt of Rs 39,000 crore – of which it owed Rs 25,000 crore to banks and financial institutions and Rs 13,000 crore to the government. Insolvency professional Santanu Ray is the liquidator of the assets of Gitanjali Gems.

Also See: ED raids on Shilpi Cable promoters’ premises