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PMC Crisis: Attached HDIL Assets to Be Released for Auction Soon?

Relief for PMC Bank depositors likely as RBI administrator writes to police, asking HDIL Properties’s be detached.

Updated
Business
2 min read
HDIL Directors Rakesh (left) and Sarang Wadhawan (right).
i

Reserve Bank of India-appointed PMC Bank administrator JB Bhoria has written to the Economic Offences Wing (EOW), asking it to release properties owned by HDIL owners, the Wadhawans. With the administrator’s nod, the Mumbai police can now move the court to have the properties detached.

Once the court issues a release order, the RBI administrator can move to auction the concerned properties.

Sources say, the EOW is likely to move the court sometime this week, to have the Rs 3,500-crore worth provisionally attached properties of the Wadhawans, detached. This could come as a huge relief to the depositors as the funds secured from auctioning the assets could be used to pay off depositors’ money.

The RBI administrator-led PMC Bank is entitled to auction properties belonging to the HDIL proprietors under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest (SARFAESI) Act. According to this Act, the bank is empowered to auction assets belonging to a defaulter to settle its dues.

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Sources in the Mumbai police had earlier told The Quint that Rakeshkumar and Sarang Wadhawan had already consented to having their attached assets sold at ‘fair market value’ in a letter. The duo have also written multiple letters to the RBI stating the same.

The EOW and Enforcement Directorate (ED), have attached a total of 18 movable and immovable properties belonging to the Wadhawans.

Provisional Forensic Audit Report Submitted to EOW

The provisional forensic audit report has meanwhile been submitted to the EOW. Auditors were roped in to find out the money trail of Rs 11,000 crores worth of deposits at PMC bank. A more detailed report is expected to be submitted in 15 days.

While the process to detach HDIL properties will soon be initiated by the police, sources told The Quint, an external expert has already started the process of finding out the value of Wadhawans’ properties that have been mortgaged with PMC bank. Once the process of valuation is through, auctioning is set to begin.

According to procedure, once valuation of assets is completed, the PMC bank must issue advertisements in the papers to inform bidders. Potential bidders receive 14 days to then place their bids.

EOW has also approached the court seeking permission to auction movable assets owned by the Wadhawans.

This move comes after the EOW secured an NOC from the Wadhawans. Once the court grants permission, the police too will follow the same procedure while auctioning the HDIL owners properties.

The total value of properties attached by both investigating agencies amounts to over Rs 3,800. This includes a sprawling 2.5 acre villa in Alibaug, a fleet of luxury cars, a speed boat and two private jets.

Meanwhile, the father and son duo – Rakeshkumar and Sarang Wadhawan – has been in judicial custody in connection with the Rs 4,500-crore worth fraud case.

(At The Quint, we are answerable only to our audience. Play an active role in shaping our journalism by becoming a member. Because the truth is worth it.)

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