UK court orders Nirav Modi to pay Bank of India over Rs 100 crore

Fugitive diamantaire Nirav Modi who has been lodged in a London prison since 2019 has suffered a major legal setback after the London Circuit Commercial Court ordered him to pay more than USD 107 million over Rs 100 crore to Bank of India in connection with a loan extended to a Dubaibased company promoted by himThe court held that Modi was personally liable for the debt after he provided a personal guarantee for a loan granted by Bank of India to a Dubaibased company of the Firestar GroupIn its judgment delivered on Tuesday the court ruled in favour of Bank of India and held that Modi was legally responsible for repaying the outstanding dues under the guaranteeThe court said Modis liability includes approximately USD 41 million around Rs389 crore towards the principal outstanding amount together with interest calculated in accordance with the banks claim taking the total liability to more than USD 107 millionThe dispute relates to a loan facility extended by Bank of India to Firestar Diamond FZE in 2012 several years before the Punjab National Bank PNB fraud case came to lightOn August 3 2012 Modi executed a personal guarantee in favour of Bank of India Under the terms of the guarantee he undertook personal responsibility to repay the loan in the event of a default by the borrowing companyAccording to court records the financial position of the Firestar Group deteriorated significantly after investigations into the alleged banking fraud surfaced in early 2018In February 2018 the Central Bureau of Investigation CBI registered its first FIR in connection with the PNB fraud case Investigating agencies later alleged that the fraud involved transactions worth nearly USD 2 billionFollowing the default by Firestar Diamond FZE Bank of India initiated independent recovery proceedings against Modi under the personal guaranteeThe bank issued demand notices seeking repayment of the outstanding dues According to the bank no payment was made despite repeated demandsModi challenged the recovery proceedings before the London courtHis lawyers argued that the personal guarantee was unenforceable and contended that the bank had failed to make a valid demand for paymentThey also argued that the bank lacked sufficient grounds to accelerate the loan and seek immediate repaymentModi further claimed that he never received notices issued by the bank in April 2018 and October 2025 because he was not present in India at the relevant timeThe court however rejected these arguments and held that the notices had been properly servedIt noted that the October 2025 demand notice had also been sent to the prison in the United Kingdom where Modi is currently lodgedThe court further observed that Modis legal representatives had been provided a copy of the April 2018 notice in 2019 demonstrating that he was aware of the banks demandIn its findings the court noted that by February 2018 it had become evident that the financial condition of Nirav Modi and the Firestar Group companies had been seriously affectedThe judgment referred to an email sent by Modi to the bank in which he acknowledged that adverse media reports had severely impacted the groups business operations and that the companies were no longer in a position to meet their outstanding liabilitiesThe court concluded that in these circumstances Bank of India was fully entitled to demand repayment of the loan accelerate the facility and enforce the personal guarantee executed by ModiThe ruling represents another significant setback for Modi in the United Kingdom where he continues to contest extradition proceedings initiated by IndiaIn March this year the UK High Court rejected his attempt to reopen his challenge against extradition relying on assurances provided by the Government of IndiaModi is presently pursuing legal remedies before the European Court of Human Rights in an effort to halt his extradition to India where he is wanted by the CBI and the Enforcement Directorate in connection with the alleged multibilliondollar Punjab National Bank fraud caseThis story has been sourced from a third party syndicated feed agencies Midday accepts no responsibility or liability for its dependability trustworthiness reliability and data of the text Midday managementmiddaycom reserves the sole right to alter delete or remove without notice the content in its absolute discretion for any reason whatsoever