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The Enforcement Directorate (ED) faces a predicament regarding the future of three confiscated high-end flats in Samudra Mahal, Worli, belonging to fugitive diamantaire Nirav Modi. Legal challenges and the long period of vacancy since Modi fled India in 2018 may result in the auction generating less than the expected market price of Rs. 110 crore. Officials deem maintaining the flats, filled with valuable household items and artworks, as an unviable alternative.
The flats have remained locked for five years and converting them into guesthouses would incur significant expenses and maintenance costs. ED officials considered using the flats as a guesthouse, similar to their use of late drug smuggler Iqbal Mirchi's confiscated premises in the nearby Ceejay House building for the agency's Zone 2 office. However, relocating the valuable items inside the flats presents a challenge. The items' worth is uncertain, and any damage could spark controversy.
Despite discussions with senior officials in Delhi, no clear solution has emerged. The officials are concerned that further delays will lead to the deterioration of valuable items within the flats. Nirav Modi fled India in 2018 after being implicated in the Punjab National Bank (PNB) loan fraud case and was declared a fugitive economic offender. In March 2019, he was arrested in the UK and currently faces extradition proceedings.
During the investigation, the ED attached assets worth Rs 4,400 crore belonging to Modi and his family. Most of these assets were handed over to PNB in 2021 for auction, including Rhythm House. These properties were initially mortgaged with the bank by Modi while seeking loan facilities. Some properties, including the flats in Samudra Mahal, which were not mortgaged, remained with the ED. After completing the legal proceedings of confiscation, these properties became government assets.
Last year, the ED initiated the process to auction Modi's flats but decided to delay the process as his son approached a court claiming ownership over them, and PNB also requested the ED to hand over the flats. In a separate auction held last year, a leading auction house sold luxury items owned by Modi on behalf of the ED. These included watches that fetched Rs 2.71 crore, a Desmond Lazaro untitled artwork of an ambassador car for Rs 22.38 lakh, and two handbags for Rs 12.91 lakh and Rs 11.09 lakh.
In conclusion, the Enforcement Directorate's quandary over the three confiscated Nirav Modi flats underscores the complexities of handling such high-value assets. To resolve the situation, the agency must strike a careful balance between maximizing auction proceeds and avoiding unnecessary controversies surrounding valuable items within the properties. This case highlights the need for a well-defined strategy for handling and disposing of confiscated assets in a timely and efficient manner, ensuring that they do not lose value over time.
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