The CBI has booked diamond jeweller Nirav Modi, his wife Ami Modi, brother Nishal Modi and his maternal uncle Mehul Choksi in connection with an alleged Rs 280 crore cheating case after it received a complaint from Punjab National Bank (PNB) on January 29.
The FIR registered by the CBI said that a few public servants “committed abuse of official position to cause pecuniary advantage to Diamond R US, Solar Exports, Stellar Diamonds and wrongful loss of Rs 280.70 crore to Punjab National Bank during 2017”. Modi, his wife, brother and Choksi are all partners of these three firms, the CBI FIR said. The case has been booked under the Indian Penal Code (IPC) sections related to criminal conspiracy, cheating and provisions of Prevention of Corruption Act.
“This matter has no affiliation, legal or otherwise with Firestar International Limited which is the flagship enterprise of Mr. Nirav Modi,” said the spokesperson of Firestar International.
“In the firm Diamond R US, Mr Choksi was a former partner and retired as Partner, as far back as 1999. For the period under scrutiny and for more than a decade prior, Mr. Choksi was not involved in any manner with the said firm. In the other 2 firms mentioned in the articles viz. M/s Solar Exports and M/s Stellar Diamonds, Mr. Choksi has never had anything to do with them in any capacity and he is not involved in any dealings that these firms may have had with any banks or financial institutions,” the spokesperson of Mehul Choksi said.
According to the complaint of PNB, two of its employees have “fraudulently” issued eight letters of undertakings (LOUs) and “transmitted SWIFT instructions to the overseas branches of Indian Banks” to raise buyers credit of at least Rs 280 crore for Modi’s firms without “making entries in the bank system”. The bank alleged that it is making an “in depth” inquiry to find outstanding LOUs which have not been detected. The bank has alleged in the complaint that a fraudulent issuance of LOUs took place on January 16, 2018 for and on behalf of the accused firms, which approached the bank and presented a set of import documents to the branch with a request to allow buyers’ credit for making payment to overseas suppliers. The bank has requested the CBI to issue a look out notice against all of the alleged accused to ensure that they do not leave the country “to avoid process of law”.
In January 2017, The Indian Express had reported that the income tax department had raided over 50 offices and residential premises of Modi, one of India’s top diamond merchants, and seized cash, jewellery and several documents that allegedly revealed tax evasion by his firms. The agency had allegedly found evidence of bogus purchases and cash sales that were not recorded in the books of the firms. It had also surveyed the offices of Gitanjali Group – one of the largest diamond companies in India and a listed jewellery retailer promoted by Choksi – in connection with the investigation.
On Monday, CBI also conducted searches in several locations in Mumbai and parts of Gujarat in connection with the case, said the CBI spokesperson.