Mehul Choksi, a key figure in the PNB scandal, cites factors beyond his control for his inability to return to India, opposing his classification as a “fugitive economic offender.” He seeks specific documents from the Mumbai passport office through his lawyer, Vijay Aggarwal.
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MUMBAI: Mehul Choksi, a prominent diamond dealer involved in the extensive Punjab National Bank (PNB) scandal, has informed a special court in Mumbai that he has been unable to come back to India due to factors beyond his influence. Therefore, he contests being categorized as a “fugitive economic offender” (FEO).
Choksi submitted an application through his lawyer, Vijay Aggarwal, requesting the court to summon certain crucial documents from the Mumbai passport office.
According to Choksi-
“These documents will provide insight into why the passport was suspended under the grounds of ‘Security Threat to India.’ They will demonstrate that Choksi’s inability to return to India is due to circumstances beyond his control. Consequently, Section 2(f)(ii) pertaining to being abroad and unwilling to return to India for criminal prosecution remains unsatisfied.”
Section 2(f)(ii) of the Fugitive Economic Offenders Act stipulates that an individual can only be declared a fugitive economic offender if they are subject to an arrest warrant for a Scheduled Offence issued by any Court in India, and if, being abroad, they refuse to return to India to face criminal prosecution.
Choksi asserted that he did not leave India to evade criminal prosecution nor is he refusing to return. He maintained that his passport had been suspended by Indian authorities, and he could not comply with the summons to appear on February 22, 2018, because his passport had been suspended by the Indian authorities.
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In his statement, Choksi reiterated, “due to reasons beyond his control” he was unable to return to India, emphasizing that the suspension of his passport rendered him incapable of traveling back to the country. He argued that this situation falls outside the purview of Section 2(f)(ii) of the Fugitive Economic Offenders Act, which requires intentional refusal to return to India to face prosecution. Choksi emphasized that his circumstances did not meet this criterion.
The legal complexities surrounding Choksi’s case have drawn significant attention, as his inability to return has prolonged the judicial process. The documents sought from the passport office are expected to provide critical insights into the rationale behind the suspension of Choksi’s passport and its implications for his return.
Aggarwal has annexed a critical piece of evidence: the notification sent by the passport office in 2018, which informed him of the suspension of his passport. The reason cited was a “Security threat to India.” This document plays a pivotal role in the ongoing legal battle surrounding Choksi’s case.
Aggarwal elaborated on this, stating-
“In such circumstances, the Directorate of Enforcement’s stance that the Applicant is unwilling to return to India is invalidated, considering that the Applicant cannot reasonably be expected to return when his passport has been suspended. Therefore, for proper adjudication of the current issue, it is imperative to present the reasons and documents demonstrating the suspension of Choksi’s passport.”
Choksi has firmly requested detailed investigation records from the Enforcement Directorate (ED). His aim is to determine whether there is any concrete evidence that indicates he was aware of the alleged bank fraud before it was exposed and thus fled the country to evade investigation. This point is crucial in understanding Choksi’s intentions and actions.
According to the ED, Choksi foresaw the unearthing of the bank fraud and anticipated subsequent arrest by investigative agencies. This anticipation allegedly led him to attempt disposing of his properties before he fled the country on January 2, 2018. However, Aggarwal disputes this narrative.
He asserts-
“Choksi’s departure from India was not driven by anticipation of an investigation, but rather by the necessity for medical treatment.”
This dispute over Choksi’s motivations is a key element in the ongoing legal proceedings. The ED had initiated proceedings to declare Choksi a Fugitive Economic Offender (FEO) a couple of years ago, and this case is still languishing in court. This is a significant part of a broader effort by the ED, which previously succeeded in having Choksi’s relative and another major accused in the Punjab National Bank scam, Nirav Modi, declared an FEO.
The case against Choksi involves multiple layers of legal and procedural complexities. Aggarwal’s argument that Choksi cannot return due to the suspension of his passport adds another dimension to the already intricate legal battle. The request for detailed documentation and evidence from the ED aims to clarify whether the allegations against Choksi hold substantial ground or if his departure was indeed driven by medical needs.
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Background of PNB Scam:
The Punjab National Bank (PNB) scam, which surfaced in early 2018, is one of India’s largest financial frauds, involving approximately Rs.14,000 crore (around $2 billion). The scandal revolves around diamantaire Nirav Modi and his uncle Mehul Choksi, who exploited the bank’s system by fraudulently obtaining Letters of Undertaking (LoUs) from PNB’s Brady House branch in Mumbai. These LoUs were used to secure overseas credit without proper authorization, bypassing the bank’s core banking system. The scam went undetected for several years due to manipulation of the SWIFT system and the evergreening of loans. The fraud’s highlighted legal and financial repercussions, highlighting severe lapses in banking oversight and prompting regulatory reforms to enhance the robustness of India’s banking sector.
