LONDON: A London High Court judge on Tuesday ruled in favor of Indian banks, detaining a fugitive diamond businessman Nirav Modi It does owe more than $10.7 million (a little over Rs 100 crore) to public sector banks.Simon Tinkler, delivering the judgment at the London Circuit Commercial Court on Tuesday, said: “Mr Modi paid the bank the principal amount due of $4.1 million (approximately Rs 389 million) on a personal guarantee. Interest calculated on a basis specified by the bank will be added. Mr Modi did not provide any defense to explain why the bank was not entitled to the amount.”Nirav, who remains in a London jail fighting extradition to India, argued at trial that the guarantee was unenforceable, that he never received a valid demand from the bank and that there was no material adverse effect to justify terminating the loan.Indian banks had lent funds to one of Nirav’s companies, Dubai-based Firestar Diamond FZE, in July 2012. Nirav provided a personal guarantee on August 3, 2013.In early 2018, when news broke of Nirav’s alleged fraud against Punjab National Bank, Indian banks decided to call in the loan. Requests made to Firestar and Nirav in March and April 2018 went unanswered.On March 8, 2024, Indian Bank obtained summary judgment for the principal amount of $4.1 million plus interest. The bank made further demands to Nirav in October 2025.Tinkler said that “beginning in mid-February 2018, it was reasonable to infer that the borrowers and each of the companies in the Firestar Group could have been significantly adversely affected by the alleged PNB fraud and that “the value of the guarantees provided by Mr. Modi … was likely to be significantly compromised”. He noted that on February 17, 2018, Nirav sent an email to the bank which read: “…the frenzied media coverage resulted in immediate searches and seizures of the business, which in turn resulted in Firestar International Pvt Ltd and Firestar Diamond International Pvt Ltd effectively no longer being the subject of ongoing concern. This therefore jeopardizes our ability to repay the Group’s debt to the banks. “Nirav denied receiving the requests for April 2018 and October 2025 at his trial, saying he was not in India at the time, but Tinkler said he was satisfied both requests had been delivered to him, particularly because the October request was also sent to HMP Thameside, where he lived, and Nirav had provided a copy of the April 2018 request to his lawyers in 2019. Tinkler found the warranty to be enforceable.
