Absconding businessman Mehul Choksi was running a ‘circular trade’ with companies propped up by him as pearl suppliers in Hong Kong, through which he had managed to siphon off over Rs 6,345 crore borrowed from Punjab National Bank, the CBI has alleged in its supplementary charge sheet in the loan fraud case.
The CBI has alleged that Choksi made his employees directors of Shanyao Gong Si Limited and 4C’s Diamond Distributors and Crown Aim, based in Hong Kong, and was controlling them.
The businessman had availed LOUs and FLCs worth over Rs 6,345 crore from Punjab National Bank showing purchase of fresh water pearls from these companies.
The agency alleged Gitanjali Gems promoted by Choksi controlled Aston Luxury Hong Kong which is holding company of Crown Aim.
It said Choksi was a director in Gitanjali Gems as well as Aston Luxury, Hong Kong.
Giving details of modus operandi, the CBI alleged that Indian companies of Choksi — Gitanjali, Gili and Nakshatra — sent pearl ornaments to Hong Kong where they were dismantled and extracted pearls were sent back to them by Shanyao Gong Si, 4C’s Diamond Distributors and Crown Aim.
Choksi availed LOCs and FLC to purchase pearls from Hong Kong-based companies whose bills were discounted by foreign lending banks on the basis of PNB guarantees.
The PNB officials at the bank’s Brady House branch in Mumbai issued 165 letters of undertaking (LoUs) and 58 foreign letters of credit (FLCs) during March-April 2017, against which 311 bills were…