Fugitive diamantaire Mehul Choksi to challenge arrest citing cancer

Choksi's lawyer said grounds for the appeal would be that Choksi is 'not a flight risk, is extremely sick and undergoing treatment for cancer'. Choksi would also argue that this is a 'political case and the human condition (in Indian prisons) was not good'.

New Delhi: Fugitive diamantaire Mehul Choksi has been arrested in Belgium where he went for treatment, with authorities there acting on an extradition request by India for his alleged involvement in the over Rs 13,000 crore Punjab National Bank loan fraud case.

Choksi (65), who had been staying in Antigua since 2018 after fleeing India, will challenge his arrest and possible extradition. He was taken into custody on Saturday on the request filed by the CBI and Enforcement Directorate (ED), which are probing the loan fraud case.

His nephew and diamantaire Nirav Modi, who is the prime accused in the case, is also facing extradition from the United Kingdom. Choksi was located in Belgium last year.

Indian agencies have been pursuing the extradition route after Interpol had removed the Red Corner Notice against Choksi in November 2022. The CBI had opposed the Interpol move.

With Choksi’s presence in Belgium established last year, Indian agencies shared two open-ended arrest warrants issued by a special court in Mumbai in 2018 and 2021 with Belgium as part of the extradition request.

Choksi's lawyer Vijay Agarwal said, “At the moment, he is in prison… the procedure is not to apply for bail but file an appeal. During that appeal, a request is made that he should not be kept in detention and he should be permitted to defend himself and oppose the extradition request while not being in custody.”

Agarwal said grounds for the appeal would be that Choksi is “not a flight risk, is extremely sick and undergoing treatment for cancer”. Choksi would also argue that this is a “political case and the human condition (in Indian prisons) was not good”.

Law Minister Arjun Ram Meghwal said Choksi’s arrest was a “victory of Indian diplomacy” under the Modi government. Minister of State for Finance Pankaj Chaudhary said the government has “zero tolerance” towards fugitives like Choksi and said the government would work to bring him back soon.

Choksi, Modi and their family members, among others, were named by the CBI in an FIR in 2018 following the loan fraud case coming to light. Before action could be taken against them, they fled the country. The ED subsequently filed a money laundering case.

According to the CBI, Choksi, his firm Gitanjali Gems and others “fraudulently” got Letters of Undertaking (LoUs) issued as well as enhanced the Foreign Letters of Credit (FLCs) without following prescribed procedure, causing a “wrongful loss” to the bank.

PNB officials at the Brady House branch in Mumbai issued 165 LoUs and 58 FLCs during March–April 2017 and these were allegedly issued to Choksi's firms without any sanctioned limit or cash margin and without making entries in PNB's central banking system to evade any scrutiny in case of a default, the CBI had claimed.

While the CBI has filed two chargesheets against him, the ED has filed three prosecution complaints in court. The ED has attached or seized assets worth Rs 2,565.90 crore in the case against Choksi and the court has allowed "monetisation" of all these properties.