Mehul Choksi anticipated arrest in PNB fraud case, fled country to avoid being held: ED

The Enforcement Directorate (ED) has questioned diamond merchant Mehul Choksi’s decision to get a passport for Antigua and Barbuda two months before a case was registered to declare him a fugitive economic offender from India, in January 2018.

In a reply filed in a special court last week, the ED also questioned Choksi’s claim that he could not travel to India on health grounds and said that evidence collected so far suggests Choksi had strategically fled the country to avoid arrest.

Last month, Choksi, 59, had complained of poor health and told the court it prevented him from travelling to India.

He had also said that he had left India before the inquiry was instituted against him and had gone to America for medical treatment.

Choksi has also claimed he could not return to India as his passport had been revoked by Indian authorities.

In its rejoinder to Choksi’s submission, filed last week, the ED said, “The investigation indicates Choksi had anticipated the bank fraud was going to be unearthed very soon and he would be arrested by investigating agencies for fraud and therefore, he tried to dispose off properties and also fled the country on January 2, 2018.”

The ED also pointed out that Choksi had obtained citizenship of Antigua and Barbuda on November 16, 2017, while the case against him was registered on January 31, 2018.

“It is very surprising why did he get an Antigua and Barbuda passport if he was willing to return to India,” said the ED.

On the subject of Choksi’s medical problems, the agency accused Choksi of misguiding the court while resisting the ED’s demand to declare him a fugitive economic offender.

The ED said Choksi was operated upon on February 16, 2018, at Lenox Hill Hospital in New York and advised to return to work and ordinary activities within three to five days.

Almost a year since, Choksi has not submitted any authenticated details of his medical condition, the agency pointed out.

“If due to his medical reasons he has been restrained from travelling, he would not have travelled from the USA to Antigua. It has come to notice that after he fled from India, he has been travelling to places abroad which are UAE, USA, Antigua,” ED said in its reply.

The absconding diamantaire is one of the prime accused in the Rs 13,500-crore Punjab National Bank (PNB) fraud.

According to the charge sheet filed by ED, three of Choksi’s companies – Gitanjali Gems, Gili India Ltd and Nakshatra – fraudulently issued letters of undertaking (LoUs) worth Rs 3,011.39 crore and got the credit limit of foreign letters of credit (FLCs) enhanced to Rs 3,086.24 .

His 47-year-old nephew, Nirav Modi, is also accused in the case.