AI OCR 
TaxTMI 
TaxTMI 
TaxTMI 
2026 (1) TMI 721
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....0,00,000 2. As per facts of the case, the CBI/BSFC (Banking Securities and Fraud Cell) Mumbai, on the basis of complaint filed by the PNB Zonal Office, Mumbai, registered FIR No. RC-02(E)/2018/CBI/BS&FC/ Mumbai, dated 15.02.2018. In the said complaint, it is alleged that the accused Bank officials viz. Shri Gokulnath Shetty, Dy. Manager and Shri Manoj Hemant Karat, Single Window Operator, PNB, Mid Corporate Branch, Brady House, Mumbai, in criminal conspiracy with the accused companies namely, M/s Gitanjali Gems Limited, M/s Gili India Limited and M/s Nakshatra Brands Limited represented by its Directors and unknown others during 2017-2018 defrauded the Punjab National Bank to the tune of an aggregate amount of USD 754.92 million (Equivalent to Rs 4886.72 crores @ Rs. 64.00 per USD) in the matter of issuance of unauthorized and fraudulent Letters of Undertaking (LoU) in favour of foreign suppliers of the accused companies. The modus operandi adopted by the accused bank officials, accused companies and their directors is that they deliberately omitted making entries of the Letters of Undertaking (LoUs) purportedly issued on behalf of the accused companies, in the Core Banking Syst....
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....20B IPC, read with 420 IPC and also read with Section 13(2) read with 13(1)(d) of Prevention of Corruption Act, 1988 against the following entities:- i) Shri Gokulnath Shetty, DY Manager (Retired), MCB, Brady House Branch, Mumbai. ii) Shri Manoj Hemant Karat, Single Window Operator, MCB, Brady House, Mumbai iii) M/s Gitanjali Gems Ltd, iv) M/s Gili India Ltd. v) M/s Nakshatra Brand Ltd. vi) Shri Mehul Chinubhai Choksi, Managing Director of M/s Gitanjali Gems Ltd., vii) Shri Krishnan Sangameshwaran, Director of M/s Gitanjali Gems Ltd., viii) Smt. Nazura Yash Ajaney, Director of M/s Gitanjali Gems Ltd. and M/s Gili India Ltd., ix) Shri Dinesh Gopaldas/Bhatia, Director of M/s Gili India Ltd. and M/s Nakshatra Brand Ltd, x) + Shri Aniyath Shivram Nair, Director M/s Gili India Ltd, xi) Shri Dhanesh Vrajlal Sheth, Director of M/s Gitanjali Gems Ltd and M/s Gili India Ltd. and M/s Nakshatra Brands Ltd. xii) Smt. Jyoti Vora, Director of M/s Nakshatra Brand Ltd. xiii) Smt. Anil Umesh Haldipur, Director of M/s Nakshatra Brand Ltd, xiv) Shri Chandrakant Kanu Karkare, D....
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....perandi by cheating the bank in connivance to same bank personnel, without proper sanction/cash margin etc. and without taking any import documents. The year-wise details of LOUs obtained by the said three entities since 2015 is as under: Year Details of LOUs and its utilization Utilization (Rs. In crore) No. of LOUs opened Amount USD Million Amount in Rs. Crore Companies Banks 2015 118 218.74 1399.93 1399.94 0.00 2016 116 220.42 1410.69 1410.69 0.00 2017 141 470.94 3032.01 7.45 3006.56 Total 375 909.56 5821.63 2818.08 3006.56 It is also revealed during the investigation that in the year 2017 most of the funds also used for repayment of earlier dues of the banks. The company-wise detail of payment made to the alleged overseas entities out of the funds obtained from LOCs since 2015 are as under: Sl. No. Name of the Company Amount (USD) 1. 4c's Diamonds Distributors, Hong Kong 130229868.56 2. Asian Diamond and Jewellary FZE, UAE 61169029.96 3. Gitanjali Ventures DMCC, Dubai 36111110.29 4. Shan....
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....hir Mehta, Milind Limaye, Aniyath Nair Subsidiary 3. Eureka Finstock Pvt. Ltd. Milind Limaye, Aniyath Nair, Kaushik Naik Subsidiary 4. Decent Securities & Finance Pvt. Ltd. Milind Limaye, Aniyath Nair, Kaushik Nair Subsidiary 5. N & J Finestock Pvt. Ltd. Aniyath Nair, Kaushik Naik, Sudhir Mehta, Subsidiary 6. Nasik Multi Services SEZ Ltd. Kaushik Naik, Sudhir Mehta, Milind Limaye Subsidiary 7. Decent Investments & Finance Ltd. Kaushik Naik, Sudhir Mehta, Sandeekumar Rawal Subsidiary 8. Gitanjali Laser House Pvt. Ltd. ....... Group Company 9. Rohan Mercantile Pvt. Ltd. Mehul Choksi, Aniyath Nair Group Company 10. Vidharbha Multi SEZ Ltd. Milind Limaye, Aniyath Nair, Kaushik Naik Subsidiary He further disclosed that the directors of the above-mentioned companies are employees of Gitanjali Gems Limited and ultimate beneficiaries of the all above mentioned companies/entities/firms is Shri Mehul Choksi. Sh. Mehul Choksi in-spite of repeated notices failed to join the investigation and co-operate in the same. On the basis of material and the statement recorded during investigation und....
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....hul Chokshi. The Deputy Director formed a belief that in view of the facts and the provisions of the PMLA, the said properties in the name of Shri Mehul Chokshi and his group companies appears to be proceeds of crime in terms of definition of section 2(1)(u) of PMLA, 2002 as 'value of such property' or where such property is taken or held outside the country then the property equivalent in value held within the county. Accordingly, Deputy Director attached the said properties by passing Provisional Attachment Order dated 03/2018 dated 28.02.2018 and thereafter he filed the Original Compliant No. (OC) 912/2018 before the AA along with the relied upon document for confirmation of the PAO. Being satisfied with the allegations mentioned in the original compliant, AA issued the show cause notice to the defendants to file their respective reply. After going through the replies & documents on record and hearing the rival submissions, the AA confirmed the PAO vide its order dated 16.08.2018. Aggrieved by the said order, the appellant filed the present appeal. 3. During the arguments Ld. Counsel for the Appellant submitted that in the conclusion drawn by the Adjudicating Aut....
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.... Companies and their subsidiary companies, as reproduced in para no. 2 above. He pointed out that except one or two entities, there was no manufacturing activities in any of the overseas entities of Mr. Mehul Choksi. They were engaged into import/export and sale amongst themselves only. The invoices of export/import were over valued to the huge extent, so as to inflate the balance sheets and procure high credit facilities from the banks. The import/export were also not genuine and were just rotational transactions. The jewellery exported from India was dismantled and diamonds/pearls taken out of it and gold/silver were sent for melting. This process were carried out mostly in Hongkong and upto an extent in Dubai. The melted metal was reexported to UAE or India in the firm of bullion and diamonds/pearls were also separately re-exported to India. The whole process was carried out without any substantial value addition and was only for inflating the turn over of Indian companies, so as to acquire maximum credit facilities from the banks. He argued that the funds and goods were also rotated from one group company to other through layers of dummy companies controlled by entry operators ....
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.... 50 of PMLA, wherein he stated that Mr. Mehul Choksi told him to dispose of the properties as he urgently required approximately Rs. 200 crores by 15.01.2018. He argued that even if the property was purchased by the trust in the year 1994, even then the same can be attached as value thereof in absence of direct proceeds of crime. Ld. Counsel for Respondent ED submitted that Appellant Rohan Choksi is holding 99.44% shares of M/s Rohan Mercantile Pvt Ltd., wherein his father Mehul Choksi is the director. He pointed out that the said company was dummy company formed by Mr. Mehul Choksi for the purpose of showing rotation of his fake transactions, wherein no movement of goods used to take place. He pointed out that Appellant Rohan Choksi is also holding 99.99% shares of another company namely M/s Lustre Industries Pvt Ltd. wherein Mr. Mehul Choksi is the director. He submitted that during the investigation it is revealed that an amount of USD 127500 (Rs.81,60,000 @ Rs. 64/ USD) has been transferred from M/s Asian Diamond & Jewellery FZE, a direct recipient of proceeds of crime to M/s Merlin Luxury Group Pte Ltd., Singapore (earlier M/s Leading Italian Jewellery Pvt Ltd.). He pointed ou....