PNB Fraud: ED Moves Court for Non-bailable Warrant Against Nirav Modi

Mumbai: The Enforcement Directorate (ED) on Tuesday moved a special court here, seeking issuance of a non-bailable warrant (NBW) against diamond trader Nirav Modi, a key accused in the over Rs 11,000-crore PNB fraud case.

On Monday, the court, set up under the Prevention of Money Laundering Act, had allowed the central agency's plea seeking issuance of Letters Rogatory (LRs) to six countries for obtaining information about the overseas businesses and assets of the diamantaire.

Special PMLA Court Judge M S Azmi on Tuesday heard the arguments of ED's special counsel Hiten Venegoankar on the agency's plea seeking issuance of the NBW against Nirav Modi, who is believed to be in the US.

The judge will hear on Wednesday Modi's lawyer Ashul Agarwal on the issue of his locus standi to address the court in the absence of his client.

Venegoankar told the court that the ED registered a case against Nirav Modi on February 15 and from that time issued three summonses to him to appear before the agency.

He said the summonses were issued on February 15, February 17 and February 22, asking him to appear before the ED on February 16, February 22 and February 26, respectively.

The ED lawyer said Nirav Modi did not appear before the agency for questioning and hence it has sought issuance of an NBW was against him.

Venegoankar said the first summons was issued to the billionaire jeweller on his last known address and his employee received it. The other two were issued via e-mail.

He said the agency received replies from Nirav Modi for two summonses. In response to the second summons, Nirav Modi said he cannot appear before the agency owing to his business commitments.

In reply to the third summons, the businessman raised the issue of his security, the ED counsel said.

"He has violated all the three summonses," Venegoankar told the court and requested the court to issue an open-ended NBW against Nirav Modi.

However, Nirav Modi's advocate Agarwal told the court he should be heard before any decision is taken on issuing the NBW as it involved fundamental rights of his client.

Meanwhile, the agency filed an application seeking LRs to seven more countries - Malaysia, Armenia, France, China, Japan, Russia and Belgium - in connection with the case.

Yesterday, the court had issued LRs for recovery/ seizure of proceeds of crime and collection of documents, evidence lying in Hong Kong, the USA, the UK, the UAE, South Africa and Singapore for purpose of investigation.

Letters Rogatory are a formal request from a court of a sovereign nation to a court of another sovereign nation for judicial assistance in a case.

On January 31, the CBI had registered an FIR against Nirav Modi, his companies, and diamond jeweller Mehul Choksi in connection with the PNB fraud.

The CBI has so far arrested Vipul Ambani, president (finance) of Nirav Modi's Fire Star Diamond, Kavita Mankikar (executive assistant and authorised signatory of three firms -- Diamond R US, Stellar Diamond, Solar Exports), Arjun Patil (senior executive, Firestar group) and Rajesh Jindal, the then head of the Brady House branch of PNB.

The others arrested are: Bechhu Tiwari, the then chief manager in the Forex department of PNB, Yashwant Joshi, the Scale II manager in the Forex department, Praful Sawant, the Scale-I officer handling the exports section, Gokulnath Shetty, the then deputy manager (now retired) of PNB, Manoj Kharat, a single window operator of PNB, and Hemant Bhat, the authorised signatory of Nirav Modi's company.

Among those arrested in connection with Choksi's firms are Nakshatra group and Gitanjali group CFO Kapil Khandelwal and Gitanjali group manager Niten Shahi.

The FIR had listed eight fraudulent transactions worth over Rs 280 crore, but based on further complaints from the bank, the CBI said the quantum of amount in the first FIR is over Rs 6,498 crore, involving 150 LoUs allegedly issued fraudulently by Shetty and Kharat.

The remaining 150 fraudulent LoUs worth over Rs 4,886 crore issued for Gitanjali group of companies were part of the second FIR registered earlier this month by the agency against Choksi and his companies Gitanjali Gems, Nakshatra Brands and Gili.