The Ministry of External Affairs on Friday suspended the validity of the passports of businessmen Nirav Deepak Modi and Mehul Chinubhai Choksi with immediate effect on the advice of the Enforcement Directorate in the wake of both being accused of being involved in a Punjab National Bank (PNB) fraud case.
A statement issued by the ministry said,”On the advice of the Enforcement Directorate, the Passport issuing authority in the Ministry of External Affairs has today suspended the passports of Nirav Deepak Modi and Mehul Chinubhai Choksi with immediate effect for a period of four weeks u/s 10(A) of the Passports Act 1967.”
“Mr. Nirav Deepak Modi and Mr. Mehul Chinubhai Choksi have been asked to respond within one week as to why their passports should not be impounded or revoked under Section 10 (3) (c) of the Passports Act 1967. If they fail to respond within the stipulated time it will be assumed that they have no response to offer and the MEA will go ahead with the revocation,”the MEA statement added.
The proposed suspension of passports of Modi and Choksi comes days after the PNB reported a fraud of Rs. 11,400 crores committed by both with the help of employees of the Mumbai branch of the bank.
The fraud was allegedly perpetrated by several PNB employees, including key branch officials, without authorisation, issuing so-called letters of undertaking, or LoUs, (essentially guarantees) that helped Modi’s companies raise credit from other banks. LoUs, issued when overseas import payments are involved, basically guarantees liability payment by one bank to another on behalf of its client.
The case relates to jeweller Nirav Modi, who was already under investigation following a PNB complaint on January 29 about fraudulent transactions of Rs.280 crore. The bank had said at the time that it was checking if the case was actually bigger.