A special Prevention of Money Laundering Act (PMLA) court in Mumbai proclaimed absconding diamantaire Nirav Modi as a 'fugitive economic offender' on the plea of Enforcement Directorate on Thursday, December 5. Nirav Modi is one of the key accused in the Rs 13,500 crore Punjab National Bank (PNB) scam of 2017.
The significant order came a day after his uncle and co-accused in the PNB scam - Mehul Choksi - suffered a huge setback when the Bombay High Court rejected his plea to stay the special PMLA court proceedings where the ED is seeking to declare him as a 'fugitive economic offender'.
After liquor baron and former chief of Kingfisher Airlines, Vijay Mallya was declared a fugitive economic offender under the provisions of the new Fugitive Offenders Act in January this year. The Act came into being in August 2018.
With this, he becomes only the second accused so far under the Fugitive Economic Offenders Act (FEOA) to have been declared a 'fugitive economic offender' after another accused, Vijay Mallya - Special Counsel for Enforcement Directorate (ED) Hiten Venegaonkar
Nirav Modi directed to appear before Special Court by January 15
The huge setback to Nirav Modi came a day after special PMLA judge V.C. Barde said that "the proclamation envisaged by Sec. 82 of the CrPC shall be issued as the accused absconded and concealing themselves to avoid execution of warrant.."
Besides Nirav Modi, his brother Neeshal Modi and an accomplice Subhash Parab are directed to appear before the Special Court by January 15, in a plea filed by the CBI in August to declare the trio as 'fugitive economic offenders'. If the two others also fail to honour the special court's summons, then they are liable to be proclaimed as 'fugitive economic offenders' and the CBI can initiate measures to attach all their known assets/properties under the FEOA.
Where is Nirav Modi currently?
Nirav Modi, the main accused in the PNB loan default case fled the country in January last year before the scam came to light. The 48-year-old was arrested on March 19 by Scotland Yard in connection with the case and is currently lodged in Wandsworth prison in south-west London. He has not returned to India despite repeated summonses from Indian probe agencies and courts.
For the fifth time in a row, the UK court rejected fugitive diamantaire's bail plea on fresh grounds that he is suffering from depression in connection with PNB fraud and money laundering case. While Nirav Modi is currently cooling his heels under judicial custody in a London prison, India is currently making efforts to extradite Nirav Modi from the UK to come and face the law.
What is the PNB Scam?
On February 14 this year, the state-run lender Punjab National Bank shocked the entire banking industry of India by revealing that it had been defrauded by Rs 11,400 crore allegedly by billionaire jeweler Nirav Modi, his family members and business partner Mehul Choksi, owner of the Gitanjali Gems at PNB's Brady House Branch in Mumbai.
Following the scam, employees of PNB including people at the general manager level were suspended from their post for their suspected involvement in the biggest scam in the Indian banking sector. Also, the government revoked passports of Nirav Modi and Mehul Choksi.
(With inputs from wires)