Gujarat HC rejects fugitive businessman Mehul Choksi's plea seeking to quash 2017 cheating case

The Gujarat High Court on Wednesday dismissed a petition filed by fugitive businessman Mehul Choksi seeking to quash a First Information Report (FIR) registered against him for allegedly duping a woman through a franchisee of his firm Gitanjali Jewellery.

Justice Sandeep N Bhatt rejected the plea moved by Choksi, then chairman and managing director of Gitanjali Gems, who is a wanted accused in the Rs 13,000-crore Punjab National Bank fraud case.

Prima facie, a case of criminal breach of trust and cheating was made out against Choksi and others and hence the FIR can not be quashed, the judge said.

The city crime branch registered the FIR in 2017 after a woman filed a complaint that she had invested some money through a franchisee of Gitanjali Jewellery here, but the franchisee shut down and she lost her investment.

Digvijay Jadeja, owner of the franchisee Divyanirman Jewellers; Choksi in his capacity as managing director of Gitanjali Group, and two directors of Gitanjali Group were named as accused in the case.

Choksi's lawyer argued that Gitanjali Jewellery Retail Limited (GJRL), a Gitanjali Group firm that manages the franchisee business, did not pass on to it the investment made by the complainant, and Jadeja did not return the jewellery belonging to GJRL or forwarded sale proceeds to it.

The matter was settled between the petitioners and complainant and she stated in her letter dated August 25, 2017, that she did not wish to pursue the criminal proceedings, the lawyer claimed.

But the HC did not accept this defence.

"Prima facie, it is found that after giving false promises through their franchisee, such showrooms are closed down and the customers who have invested their money are cheated," the court said, observing that such cases had happened not in one or two places but in every place where Gitanjali Gems had a franchisee.

"It is true that merely being directors, they cannot be held responsible for the criminal act, but looking to the nature of the allegations in the present case, as there is a large-scale scam committed by Gitanjali Gems across the country, the petitioners cannot escape their liability at this stage," the court said.