London: In a significant legal victory for Bank of India, the London High Court has ordered fugitive diamantaire Nirav Modi to pay more than $10.7 million (approximately ₹100 crore) to the public sector lender in a civil recovery case linked to a loan extended to one of his companies. The ruling marks another setback for Modi, who remains in custody in the United Kingdom while facing extradition proceedings related to the multi-crore Punjab National Bank (PNB) fraud case.
The judgment was delivered by Judge Simon Tinkler of the London Circuit Commercial Court, who held that Modi was personally liable under a guarantee he had signed in connection with a loan granted by Bank of India to Firestar Diamond FZE, a Dubai-based company belonging to his business group.
According to court documents, Bank of India extended the loan to Firestar Diamond FZE in July 2012, and Modi subsequently signed a personal guarantee on August 3, 2013, assuring repayment obligations. The bank later moved to recover the dues after reports of the alleged PNB fraud involving Modi surfaced in early 2018.
In his ruling, Judge Tinkler stated that Modi was liable under the personal guarantee for the principal amount of $4.1 million, with additional interest to be calculated based on the bank’s submissions. The judge observed that Modi had failed to provide any valid defence explaining why the bank was not entitled to recover the outstanding amount.
“Mr Modi is liable under the personal guarantee to the bank for the principal amount due of $4.1 million. The interest calculated on the basis set out by the bank is to be added. Mr Modi has not provided any defence to explain why the bank was not entitled to that sum,” the court noted.
The case stemmed from the financial turmoil that engulfed Modi’s business empire following the emergence of allegations related to the PNB fraud. Bank of India issued repayment demands to both Firestar Diamond and Modi in March and April 2018, but the demands went unanswered.
During the proceedings, the court examined an email sent by Modi to the bank on February 17, 2018, in which he acknowledged the severe impact of the controversy on his businesses. In the email, Modi stated that intense media scrutiny and investigative actions had effectively forced Firestar companies to cease operating as going concerns, thereby affecting their ability to repay bank dues.
The court had previously granted summary judgment in favour of Bank of India on March 8, 2024, covering the principal sum and interest. The lender later issued another formal demand to Modi in October 2025.
Modi challenged the claim on three grounds, arguing that the personal guarantee was unenforceable, that valid demands had not been served, and that there had been no material adverse effect warranting the termination of the loan agreement. However, the court rejected all three arguments.
Judge Tinkler concluded that both the April 2018 and October 2025 demand notices had been properly delivered. The court noted that the latter demand was sent to HMP Thameside prison in London, where Modi is currently lodged, and that Modi himself had supplied a copy of the earlier demand to his legal representatives.
The judge further observed that the alleged PNB fraud had materially and negatively affected the borrower and companies within the Firestar Group, significantly impairing the value of guarantees provided by Modi.
Nirav Modi, 49, has been in UK custody since his arrest in London in March 2019. He is accused of orchestrating the PNB fraud through the use of unauthorised Letters of Undertaking to secure overseas credit facilities. Earlier this year, the UK High Court dismissed his appeal to reopen extradition proceedings, bringing him a step closer to being returned to India. The latest ruling, however, relates specifically to Bank of India’s efforts to recover outstanding dues through civil proceedings.
