Big Blow to Mehul Choksi, SC Restores Alleged Cheating Case

The Supreme Court recently set aside a 2017 judgement by the Gujarat High Court, which had dismissed an FIR filed by the State Police in 2015 against fugitive businessman Mehul Chinubhai Choksi and his wife, Priti Choksi.

A bench of Justice Sanjiv Khanna and Justice SVN Bhatti directed the Gujarat police to proceed with the investigation.

“Investigation will continue without being influenced by any of the findings or observations made in the impugned judgment or the present order. We also clarify that while conducting the investigation, the Investigating Officer will keep in mind the rulings of this Court and High Courts interpreting Sections 406, 420, 464 and 465 etc of the IPC,” the order stated.

The FIR, registered by Gandhinagar police on the complaint of Digvijaysinh Himmatsing Jadeja, accused Choksi’s company of criminal breach of trust, cheating, forgery, and criminal conspiracy for failing to return 24-carat gold bars as per agreements made in 2013. The complainant asserted that Choksi’s company had violated the terms of the agreement by not returning the gold bars and had misappropriated them.

The Gujarat High Court had, on May 5, 2017, quashed the FIR, citing that the complaint primarily dealt with a civil breach of contract, and no criminal offense was evident. Overturning this decision, the Supreme Court argued that the High Court had exceeded its jurisdiction under Section 482 of the Code of Criminal Procedure by delving into the factual controversy.

“Suffice it is to observe that the High Court should not have examined and recorded a conclusion on the disputed fact to quash the FIR. At this stage, we record that under the registration of the FIR, the investigation had proceeded,” the order stated.

The Supreme Court permitted the investigation to proceed without being swayed by the High Court’s findings. The bench clarified that the observations in the order should not be construed as comments or opinions on the merits of the case. Mehul Choksi, along with his nephew Nirav Modi, is wanted in the Punjab National Bank (PNB) scam, where they are accused of defrauding the bank of more than Rs 14,000 crore.