Enforcement Directorate set to seize assets of Kothari company head

Enforcement Directorate (ED) has received the final approval to seize Rs 1.59 crore deposits belonging to Pradip D Kothari, Chairman of Kothari Industrial Corporation Limited, Chennai following investigation against persons holding foreign assets without proper approval.

The central probe agency in a press release on Thursday said that it got the approval of the competent authority, which is the Commissioner of Customs (Appeals), for seizing the assets. The amount is equivalent to the value of his alleged assets stashed abroad, in connection with ED’s probe into the HSBC black money list.

The ED had initially seized the deposits in June this year under the recently-introduced section 37A (1) of the Foreign Exchange Management Act (FEMA) that empowers it to seize equivalent property in India, if there is a suspicion that any forex, foreign security or any immovable property located outside India is held in contravention of the Act.

This section or amendment was brought in FEMA in 2015 as part of the Union government’s strategy to combat black money stashed abroad. “After due process of law, competent authority has confirmed the seizure of movable properties of about Rs 1.59 crore of Pradip D Kothari made by the ED under the newly introduced provisions for holding foreign assets without proper approvals,” the agency said in a press release.

The ED began probing Kothari in respect of credit of foreign exchange that was ‘held’ in HSBC Bank, Geneva, and found the money was held in the foreign accounts without proper permission from RBI and without declaring the same to tax authorities.