Nirav Modi | Photo Credit: ANI

Nirav Modi, fugitive diamantaire incarcerated in a London prison since 2019, has suffered a major setback following a London Circuit Commercial Court ordering him to pay more than $ 10.7 million, which is over Rs 100 crore, to Bank of India for defaulting a loan given to a Dubai-based company promoted by him.

The court, in its judgement delivered on Tuesday, said Modi was personally liable for the debt after he provided a personal guarantee for a loan granted by Bank of India to a Dubai-based company of the Firestar Group in 2012.

Modi’s liability, as per the court order, includes approximately $4.1 million (around ₹38.9 crore) towards the principal outstanding amount, along with interest calculated in accordance with the bank’s claim, taking the total liability to more than $10.7 million.

Bank of India gave loan to Firestar Diamond FZE in 2012, which was several years before the Punjab National Bank (PNB) fraud case came to light leading to action against Modi.

Under the terms of guarantee signed on August 3, 2012, Modi undertook personal responsibility to repay the loan in the event of a default by the borrowing company.

The court records showed that the financial position of the Firestar Group deteriorated significantly after the CBI registered first FIR in February 2018 to probe PNB bank fraud to the tune of nearly $ 2 billion.

Owing to Firestar Diamond FZE inability to pay off the loan, Bank of India initiated independent recovery proceedings against Modi under the personal guarantee. The bank issued repeated demand notices seeking repayment of the outstanding dues but no payment was made.

Modi challenged the recovery proceedings before the London court, with his lawyers arguing that the personal guarantee was unenforceable and contended that the bank had failed to make a valid demand for payment.

He also 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 time.

The court, however, rejected these arguments and held that the notices had been properly served. It noted that the October 2025 demand notice had also been sent to the prison in the United Kingdom where Modi is currently lodged.

The court further observed that Modi’s legal representatives had been provided a copy of the April 2018 notice in 2019, demonstrating that he was aware of the bank’s demand.

Modi continues to contest extradition proceedings initiated by India to bring him back to face trial in corruption cases. In March this year, the UK High Court rejected his attempt to reopen his challenge against extradition, relying on assurances provided by the Government of India.

Published on June 24, 2026