Fugitive billionaire diamond tycoon tracked down by Telegraph should face trial in India, judge rules

Mr Modi wearing a £10,000 ostrich hide jacket when confronted in the street by our reporter in 2019

Credit: EDDIE MULHOLLAND FOR THE TELEGRAPH 

Arguing on behalf of the Indian government, the Crown sought to establish a prima facie case against Modi and to establish there are no human rights issues blocking his extradition.

They accused the billionaire jeweller of presiding over a "Ponzi-like scheme" that involved bank guarantees which allow foreign transactions, called "letters of understanding" (LOUs).

District Judge Goozee said: "When a bank issues an LOU on behalf of a customer, it allows the customer to obtain credit from a foreign bank.

"[Deputy General Manager of the Punjab National Bank] Avneesh Nepalia explained that he believed the LOUs had been issued fraudulently because the appropriate procedures had not been followed, appropriate documentation had not been obtained, the LOUs had not been recorded with entries in the bank’s system and the LOUs had been issued for the payment of import bills but were not in fact used for that purpose.

"On 5 February 2018 Nirav Modi personally wrote to the Punjab National Bank (PNB) accepting the fact of the debt and taking responsibility for the outstanding borrowing."

He said the argument that the borrowing was not known about or sanctioned by PNB is "inherently implausible" because of the "amount of unsecured debt INRs 6498 crores (equivalent to £729m) obtained by the three firms."

"In any event, that is disputed in the evidence from the Bank officials.

"PNB officials unravelled a “Ponzi-like” structure where LOUs were used to repay earlier ones.

"Following the reporting by the Bank to the CBI, concerted attempts were made to prevent dummy directors of companies controlled by NDM in Dubai and Hong Kong co-operating with investigators."

Modi’s defence team tried arguing that his "deteriorating" mental health condition met the Section 91 threshold of the Extradition Act 2003 — which was most recently used to block the extradition of Wikileaks founder Julian Assange to the United States on the grounds of being "unjust and oppressive" as he is a high suicide risk.

In District Judge Goozee’s decision, he added: "I am sending this case to the Secretary of State for a decision as to whether Nirav Modi is to be extradited.

"I hereby notify Nirav Modi of his right to appeal to the High Court against my decision to send the case to the Secretary of State.

"I also inform him that if he exercises his right of appeal, the appeal will not be heard until the Secretary of State has made their decision.

"The appeal can be on a point of law or fact or both."