A London court has ordered fugitive billionaire Nirav Modi to pay more than USD 10.7 million (over Rs 100 crore) to the Bank of India in a loan recovery issue related to a firm he operated in Dubai.
This was another major legal setback for Nirav Modi in the UK.
The London Circuit Commercial Court ruled in favour of the Bank of India on Tuesday, ruling that Nirav Modi, who was also a prime accused in the Rs 13,000 crore PNB scam, was personally responsible for repayment under a personal guarantee he had signed for a loan given to Firestar Diamond FZE, a Firestar Group company based in Dubai.
After the borrowing firm defaulted, the court ruled that Modi was still legally liable for the obligation.
The total recoverable amount is more than USD 10.7 million, including the principal outstanding amount of over USD 4.1 million (about Rs 38.9 crore) and any applicable interest claimed by the bank.
The dispute stems from a lending facility approved by the Bank of India in 2012, prior to the emergence of claims in the Punjab National Bank (PNB) fraud case.
On August 3, 2012, Modi signed a personal guarantee in the bank’s favour, agreeing to personally pay back the money if the borrower didn’t fulfil its commitments.
According to court rulings, Firestar Group’s financial situation drastically declined following the discovery of the purported banking offense in early 2018.
The Central Bureau of Investigation (CBI) filed its first FIR in relation to the PNB fraud case in February of that year.
Subsequently, investigators claimed that transactions totaling about USD 2 billion were implicated in the crime.
In accordance with the personal guarantee arrangement, the Bank of India started independent recovery procedures against Modi when Firestar Diamond FZE defaulted.
The bank repeatedly sent demand notifications requesting payment of unpaid balances, but insisted that no money had been received in spite of these efforts.
Nirav Modi argued that the personal guarantee could not be enforced and challenged the proceedings before the London court.
His legal team argued that Bank of India did not have enough justification to expedite the loan and pursue fast recovery, nor had it issued a legitimate repayment demand.
Additionally, his attorneys contended that because he was not in India throughout the pertinent period, he did not receive letters sent in April 2018 and October 2025.
The court determined that the notices had been duly served and rejected those arguments.
