Fraud has been going on since 2010, CBI tells court

An employee of fugitive billionaire diamond merchant Nirav Modi’s firm moved the Bombay High Court on Monday, contending that her arrest by the CBI in the ₹12,700-crore Punjab National Bank (PNB) scam was in violation of the law. In her petition, Kavita Mankikar claimed she was arrested on February 20 at 8 p.m. by CBI officers, but the law lays it down that a woman cannot be arrested after sunset.

Ms. Mankikar, who was Mr. Modi’s executive assistant and the authorised signatory for group firms Diamond R US, Stellar Diamond and Solar Exports, was arrested with five others. This included Vipul Ambani, President (Finance) at Mr. Modi’s Fire Star Diamond. She had been remanded in CBI custody till Monday.

Vijay Agarwal, who is representing Ms. Mankikar in the case, said before the single Bench of Justice N.W. Sambre, “The petition seeks the High Court to hold the petitioner’s arrest as illegal and unconstitutional as it was done in gross violation of the provisions of law.” Justice Sambre posted the matter for hearing on March 12.

According to the CBI, Ms. Mankikar fraudulently signed applications for issuance of Letters of Understanding (LoU). On January 31, the CBI had registered a case against Mr. Modi, his uncle Mehul Choksi, the owner of Gitanjali Gems, and several others including PNB officials.

In its FIR, the CBI had listed eight fraudulent transactions worth over ₹280 crore. Later, based on further complaints from the bank, the agency said the quantum of amount in the first FIR was over ₹6,498 crore, involving 150 LoUs allegedly issued fraudulently. The other 150 fraudulent LoUs worth over ₹4,886 crore, issued for the Gitanjali group, were part of the second FIR registered later by the agency against Mr. Choksi and his companies Gitanjali Gems, Nakshatra Brands and Gili.

In two letters last month to Archana Salaye, assistant director, Enforcement Directorate (ED), in response to summonses, Mr. Modi said, “A lady executive (Kavita Mankikar) of my organisation has been arrested by the CBI illegally, in complete violation of the Criminal Procedure Code. And when the liberty of a female is not been priced (sic) by the investigating agencies, my concern for my safety and for the unfairness in the process is not in any manner misplaced.”

Custody extended

Meanwhile, the CBI, seeking custody of four people arrested on Sunday, and extension of custody of six others — including Ms. Mankikar — arrested last month, said in court on Monday that violation of norms for issuance of Letters of Undertaking (LoUs) to Mr. Modi and his uncle Mehul Choksi had been going on since 2010.

The CBI lawyer, while seeking custody of the four arrested yesterday, also explained the modus operandi of the fraud before the special CBI court here, and said this had been going on since 2010. Judge S.R. Tamboli, giving CBI their custody till March 17, said there were voluminous documents with which the accused needed to confront.

The court also remanded six others, arrested on February 20, in judicial custody till March 19. Their CBI remand ended today.