HC asks Delhi police to start investigation against Mehul Choksi in cheating case
New Delhi: The Delhi high court on Tuesday directed Delhi Police to proceed with an investigation in a case of misrepresentation and cheating against Mehul Choksi, promoter of Gitanjali Gems Ltd, filed by seven Delhi businessmen.
“Let the investigating officer investigate and file a status report,” justice Mukta Gupta ordered after the parties informed the court that all efforts for an out-of-court settlement between parties had failed.
The court further directed that an interim order prohibiting any coercive action against Choksi in connection with the present case would continue to remain in force.
The court was hearing a plea by Choksi for quashing a 12 July 2016 FIR filed against him and others on the order of a Saket metropolitan magistrate, Delhi.
The FIR was filed by Vaibhav Khuraniya and Deepak Bansal, two of the seven businessmen, against Choksi alleging that Choksi had misrepresented and cheated them by supplying sub-standard diamonds at an inflated price.
The complainants claimed that Choksi had assured them of stock worth Rs3 crore on a security of Rs1.5 crore for their retail franchise store of Gitanjali in West Delhi.
However, in October 2013, the complainants discovered the alleged fraud after receiving what they called “third grade” diamonds worth Rs50-70 lakh.
Sandeep Kapoor, appearing for Choksi, argued that no case was made out against him as he was not a party to the franchise agreement between Gitanjali Gems and the complainants and he could not be “vicariously” made responsible for the agreement. He further submitted that Gitanjali Gems stopped supplying stock to the complainants after they failed to provide details of the “unpaid sock account”.
Choksi along with his nephew Nirav Modi are at the centre of one of India's biggest banking scams running into Rs11,400 crore. Modi and Choksi allegedly fraudulently obtained letters of undertaking from the Brady House branch of Punjab National Bank for raising credit from overseas banks.
The matter is listed for further hearing on 3 May.