Punjab & Maharashtra Cooperative (PMC) Bank has filed an application before the adjudicating authority under the Prevention of Money Laundering Act (PMLA) in Delhi, seeking restitution of assets worth about Rs 100 crore of the promoters of Housing Development & Infrastructure (HDIL), that has been seized by enforcement agencies, according bank officials familiar with the development.
Last week, PMC Bank moved the application before the adjudicating authority under section 8 of PMLA, which allows for restitution of assets before or during the trial in a case. Restitution means returning property or the monetary value of loss to the proper owner.
To support its plea, the bank has also obtained no-objection-certificates from the jailed promoters of HDIL — Rakesh Wadhawan and Sarang Wadhawan — and the Enforcement Directorate (ED) for restitution of these assets belonging to Wadhawans, seized the agency. The plea is a part of the RBI-appointed administrator’s efforts to recoup a small part of the huge losses of the bank due to its exposure to HDIL.
The assets for which PMC Bank has filed a petition include jewellery worth Rs 60 crore and high-end vehicles including two Rolls Royce, two Land Rover, a Mercedes and a Bentley among others, all belonging to the Wadhawan family.
The adjudicating authority is likely to pass its order on the bank’s application next week. If it rules in favour of PMC Bank, then this will be the first case of restitution in the country under the PMLA.
The provision of restitution/restoration of attached property was introduced in PMLA in 2015, three years after the Saradha chit fund scam broke, mainly to give relief to small depositors duped by ponzi schemes or other fraudulent investment schemes. However, since then, not a single plea for restitution of assets have been approved by the special courts in cases pertaining to money laundering.
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