New Delhi: In a major breakthrough, the Enforcement Directorate (ED) has finally got access to documents that may help unravel the business empire of 1993 Mumbai serial blasts accused Iqbal Mirchi. The agency has alleged that his son Junaid Iqbal Memon and his associates have managed to dispose of assets owned and controlled by Mirchi in India and took the sale proceeds amounting to nearly Rs 2,000 crore out of the country through hawala and other channels.

Junaid Memon was left with no option but to share details of his assets and investments following an order by the Delhi High Court, which is hearing his petition against the move to cancel his passport.

The ED claims that Iqbal Mirchi, the right-hand man of underworld don Dawood Ibrahim, had pumped in huge sums in properties and businesses in India and abroad. After his death in 2013 his son Junaid had taken over the empire. Sources said ED had decided to send the request to cancel his passport, as he was not cooperating with the investigation related to money laundering case. Subsequently, the Consulate General of India in Dubai had informed Junaid about the government decision to suspend his passport. He has been living in the UAE since 1993.

Junaid had moved the Delhi High Court contending he had provided all the relevant documents. Further, the Foreign Exchange Management Act (FEMA) did not apply to him, as he was a Non-Resident Indian (NRI). The ED has been opposing the writ petition on the grounds that the matter pertains to an investigation into money laundering and on account of the fact that most of the money had been laundered offshore.

Taking note of the fact that business empire of Iqbal Mirchi had grown over a very short period of time, the Delhi High Court though stayed cancellation of his passport, however, agreed to consider his writ only after Junaid shared documents required by the agency in the money laundering probe. An ED officer said the agency has received a large number of documents, which are being examined.

“It had to be seen if he has shared with us all relevant documents. We may ask for more if there are missing links," the officer said.

ED claims Mirchi son misled investigators

ED in its affidavit has alleged that late Iqbal Mirchi, a prime suspect in the 1993 Mumbai blast case was involved in smuggling of narcotics, money laundering and extortion racket. He was closely associated with the network of Dawood Ibrahim and he amassed great wealth, in and outside India, out of his criminal deeds. The agency further said that since his death in August 2013, it is reliably learnt that Junaid has taken over his father’s money laundering role in the Dawood Ibrahim network and agency has gathered significant evidence in the ongoing investigation.

According to the agency, it issued five different directives on 10 April 2015 under section 37 of FEMA to Junaid and to four companies — Vantage Enterprises Private Limited, Rock Stone Reality and Hotels Private Limited, Realtors Hotel Projects Private Limited, Horizon Estate Constructors Private Limited — in which Junaid is director and shareholder, requesting them for wide-ranging information including shareholding in companies, interests in movable and immovable properties, remittances made to and from India. The four companies independently responded on 21 April 2015 seeking four weeks time to furnish the information on the ground that Junaid was travelling. ED claims since no information was forthcoming, it issued a reminder on 15 May 2015. A response was received by the agency on 20 may 2015 in which Junaid contended he does not have any business interest in India and being an NRI, he was not obliged to furnish any information to the ED. He had also requested the ED to withdraw its directives and cease the investigation.

On 2 June 2015, the four companies supplied information to the ED, which, it claims, is publicly available as part of the statutory records, however, the specific information sought by the agency was not furnished. On 7 August 2015, the ED issued summon to Junaid to appear before the investigator along with books of account and other documents. The ED said since responses of Junaid clearly indicated that he was unwilling to cooperate with the investigations into his activities which have a bearing on the sovereignty and security of India and especially his reluctance to share information about assets held abroad, the agency made a request on 18 August 2015 to the foreign secretary, Ministry of External Affairs to revoke his passport.

Two days later, Junaid in his communication to the ED requested another four weeks time to furnish documents as he was travelling. Agency claims that the reason provided for seeking time to furnish information was clearly malafide and mendacious since information sought under the summon issued on 7 August 2015 was nearly identical to information sought under directive on 10 April 2015. The agency further said it became clear that Junaid was not inclined to supply the documents despite having been afforded more than four months and request for more time was merely a dilatory tactic to scuttle the investigation.

Subsequently, his passport was suspended on 20 August 2015 for a period of four weeks followed by a show cause notice for revocation. On 21 September 2015 Junaid responded to the ED reiterating that he is not obliged to give the desired information pertaining to the companies outside India since FEMA is not applicable to businesses and properties outside the country for NRIs. Subsequently, Junaid was asked to personally appear before the ED on 1 October 2015. Junaid through his representative requested the date for appearance to be advanced for 28 September 2015. But, he failed to appear. The ED subsequently fixed two dates 5 and 19 October 2015 for Janaid to appear but he did not appear even on two dates. ED claims Junaid stand was softened and he had provided some information only after the request for suspension of his passport was made.

“The agency has a credible basis and sufficient evidence to suggest that the petitioner (Junaid) is involved in sophisticated and large-scale money laundering operations for transfer of sale proceeds of assets in India belonging to late Iqbal Mirchi to foreign countries. It may be mentioned here that section 3 of FEMA covers resident, non-resident and foreign nationals also and various regulations of FEMA applicable to the NRIs and person resident outside India,” ED affidavit said.

Junaid counters ED charges

Junaid in his writ petition filed before the Delhi High Court said that his representative had supplied the relevant information sought by the ED on 22 September 2015 and furthermore documents were furnished. The petition further argued that documents submitted by Junaid was accepted by the ED without any objection and they were not told that they did not comply to summons nor any proceedings were initiated against the petitioner for imposing a penalty for non-compliance with the summons under section 13 of FEMA.

The petition further contended that despite having fully cooperated with the investigation, the drastic step of suspending the passport was taken. On the issue of delay in supplying the documents, it said since desired documents were voluminous and would have taken time to compile and send it to Delhi, Junaid had requested for more time. It has also charged that ED order to suspend the passport was exercised arbitrarily with a malafide intention to harass Junaid.

The ED, however, insisted that Junaid did not provide requisite documents for the investigation. On 14 August 2018 Delhi High Court directed Junaid should provide all the documents notwithstanding his contention that those documents are not required to be disclosed. The court had further observed that once Junaid complies with the requirement, the ED will examine whether they still require his personal appearance in the money laundering probe.