The revenue department has asked banks that loaned money to Nirav Modi and Mehul Choksi to pay the tax owned by them or held by them “for or on account of” the two businessmen, The Economic Times reported.
Modi and Choksi are accused of defrauding the Punjab National Bank of Rs 12,703 crore in one of India’s largest bank scams. The bank initially said the amount was around Rs 11,380, but in a stock exchange filing late on Monday revealed additional fraud of Rs 1,323 crore.
The revenue department’s notices to banks that loaned money to Choksi’s Gitanjali Gems asked them to pay Rs 305.12 crore in tax dues. “You are hereby required to pay this office any amount due from you or held by you for or on account of the said assessee,” the tax notice for banks associated with Gitanjali Gems said. The notice said banks need to also pay money – apart from the Rs 305.12 crore – “that may subsequently become due”.
The notices to banks that loaned to Modi’s Firestar Diamond said the revenue department was planning to attach the company’s accounts in 21 banks. The income tax department said Firestar Diamond has been on its radar since 2012, and that provisionally attaching the firm’s accounts was necessary to “protect the interest of the revenue department”.
The Economic Times said it has seen both documents.
The report said the notices regarding Modi’s assets were issued on February 16, and Choksi’s three days later. On Monday, Modi’s company Firestar Diamond Inc filed for bankruptcy in the United States, citing liquidity and supply challenges.
Experts said that while banks usually recover such legal dues, revenue authorities, including the income tax department, can also send notices to banks holding accounts of these companies to seek pending dues.
The department’s notice has warned banks not to let Choksi withdraw money from his accounts, and said it would try and recover the money if the banks do not pay up. “If you fail to make payment in pursuance of this notice, you shall be deemed to be an assessee in default in respect of the amount specified,” it said.
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