NEW DELHI: Three days after billionaire jeweller Nirav Modi accused the Punjab National Bank (PNB) of running to the investing agencies in haste instead of trying to recover dues from him using regular channels, the state-owned lender on Thursday hit back at the absconding businessman saying it was compelled to do what it did as there was clear illegality. It also asked him to submit a concrete and implementable plan to pay back the liabilities.
“You were getting LoUs (Letters of Undertaking) issued illegally and in an unauthorised way through a few bank officials. At no stage were such facilities extended by our bank to the three partner firms. When these illegal activities surfaced, they pointed out to apparent violation of FEMA (Foreign Exchange Management Act) and money laundering aspect,” PNB’s general manager (international banking division) Ashwini Vats said in a reply to Nirav Modi.
The PNB letter was in response to a letter sent on Monday by Modi to banks affected by the scam saying the companies controlled by him were unable to clear their dues owing to actions taken in “haste” by PNB.
“In the anxiety to recover your dues immediately, despite my offer, your actions have destroyed my brand and the business and have now restricted your ability to recover all the dues leaving a trail of unpaid debts,” Modi had said in his letter to various banks, including PNB.
He also claimed that the dues owed by him to PNB was less than Rs 5,000 crore and not Rs 11,400 crore as was publicised.
He had added that the inventory, including assets and receivables, of Firestar International and Firestar Diamond International and three other firms could have settled the pending dues to the banks. He also reportedly offered to even clear his dues by selling Firestar International.
However, PNB dismissed all the claims and said that Modi in his email exchanges had come up with “vague offers” to repay the amounts due and had not submitted a concrete plan.
“The commitments and undertaking for sparing of the total liability were not backed by providing upfront amounts and timelines,” PNB said in the letter and asked him to submit a “concrete and implementable plan” to pay back the liabilities. In a regulatory filing, PNB said that it followed all lawful avenues available to it to recover dues.