ICICI Bank, the lead banker to the Mehul Choksi-promoted Gitanjali Gems, has sought to attach various properties of the group under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (Sarfaesi) Act to recover multiple loans amounting to over Rs 800 crore.
The assets sought to be attached by the lender include the brands Gili, Sangini and Asmi owned by Gili India and Nakshatra Brands. This is in addition to real estate assets such as land at Panvel, SEZ properties at Nashik and Hyderabad , and offices at the Bandra Kurla Complex and Seepz SEZ.
These advances are outside the Rs 13,400 crore that is due to Punjab National Bank (PNB) following a fraud committed by Choksi and his nephew Nirav Modi. With total claims against the duo crossing Rs 20,000 crore, lenders say they will need to meet and decide a course of action. The Sarfaesi Act allows lenders to attach and sell property of defaulters and their guarantors. Under the law, lenders are required to give a 60-day notice before attaching the property.
In April this year, the private bank had approached the National Company Law Tribunal (NCLT) to protect its own interest in a case filed by the corporate affairs ministry to attach properties belonging to the Modi and Choksi groups. The private lender had informed the court that ICICI Bank and 23 other lenders were planning to move the debt recovery tribunal (DRT) to recover combined loan obligations of more than Rs 8,000 crore. The advantage of proceeding in the DRT is that the lenders can go after the personal assets of promoters, a recent amendment in the code allows lenders to simultaneously invoke promoter guarantees. Also, the IBC gives banks priority over other creditors and allows them to sell the entire businesses with fewer hassles.