ED hopes to recover Rs 3,000-4,000 cr by attaching properties of Nirav Modi, Mehul Choksi

The Enforcement Directorate (ED) hopes to recover Rs 3,000-4,000 crore from properties of Nirav Modi and Mehul Choksi, sources told Moneycontrol. This is in addition to the diamonds and precious stones seized by ED, valued at Rs 5,816 crore by Gitanjali Gems.

As per the assessment of income tax paid, ED believes Choksi and Modi collectively own properties worth up to Rs 4,000 crore.

The ED has sent all seized diamonds to a laboratory for assessing their value. Along with that, ED has sought a report from income tax department detailing Nirav Modi’s properties.

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A source in the income tax department told Moneycontrol: “In our assessment, we have found more than twenty properties in Mumbai, Surat, Pune and Nashik which are valued not more than Rs 1,500 crore including one solar plant in Nashik. This solar plant also used to have some tax benefit.”

As per sources, Nirav Modi owns 25 real estate properties across Surat, Nasik, Mumbai and Pune. While Choksi owns four SEZs and two malls across India, and six flats in Mumbai worth over Rs 2,500 crores.

Most of Mehul Choksi’s properties are mentioned in the company’s books. However, investigation agencies have found the properties are in the name of shell companies.

The Income tax department identified more than 200 shell companies, and it may attach these properties in Benami transaction if legitimate sources are not found.

A senior official of Enforcement Directorate told Moneycontrol “This is not the question of fake diamonds, we are hopeful most of the money will be recovered by attachment of seized diamonds and properties. We should wait until the valuer submits the report to us. However, we are attaching properties of Mehul Choksi and Nirav Modi. Nobody can doubt the ready reckoner rate of properties which is easily available. Initially, we were attaching diamond and now focusing on other movable and immovable properties.”

ED is leaving no stone unturned for investigations related to this case. It has also started investigating foreign direct investments (FDI) into the brand Nirav Modi. It is even trying to see if a part of the funds raised via fake letter of understandings (LoUs) could be brought back in the form of FDI.

The ED is also issuing a Letter of Rogatory (LR), a formal request to a foreign court for some type of judicial assistance, for scaling up the investigation in the overseas market. In the first phase, ED will issue LR to Dubai, Belgium and Hong Kong.

A senior ED  official told Moneycontrol “Our investigation will cover every direction and FDI investment is one of the aspects of investigation.”