Special Court Allows ED To Attach All Properties Of Fugitive Diamantaire Nirav Modi Barring Mortgaged Properties

A Special Court in Mumbai on Monday allowed the Enforcement Directorate (ED) to attach properties of fugitive economic offender (FEO) Nirav Modi and to confiscate them, with the exception of those properties mortgaged or hypothecated to parties like Punjab National Bank (PNB).

Special Judge, City Civil & Sessions Court VC Barde passed the order while hearing an application filed by ED on January 19 under Section 12(2) of the Fugitive and Economic Offenders Act.

The Fugitive Economic Offenders Act, 2018 empowers any special court set up under the Prevention of Money Laundering Act, 2002, to confiscate all properties and assets of economic offenders who are charged in offences measuring over Rs.100 crores and are evading prosecution by remaining outside the jurisdiction of Indian courts.

The act was passed on July 25, 2018 and Vijay Mallya was the first person to be declared a fugitive economic offender under this act before Nirav Modi. With the Special Court's order, ED is now cleared to confiscate property of an economic offender for the first time since the act came into place.

Those properties claimed by the PNB Consortium under Section 12(7) of the FEO Act only secured by mortgage, hypothecation and guarantee and high value paintings seized by the income tax department will be excluded from the list properties of Nirav Modi that can be attached.

Court noted that this exclusion from the list of properties that can be attached under the act will entitle the PNB Consortium and IT Department to proceed with their claim before the Competent Court, Authority or Tribunal in the manner provided by law.

Nirav Modi was declared a fugitive economic offender on December 5 last year. Court has directed ED to attach the said properties within one month and after the attachment they will be confiscated by the Central government under Sections 12(2)(8) of the FEO Act.