The Gujarat High Court, on a Wednesday, rejected a plea by fugitive businessman Mehul Choksi to dismiss a First Information Report (FIR) filed against him. The FIR alleged that he defrauded a woman through a franchisee of his company, Gitanjali Jewellery.

Justice Sandeep N Bhatt denied the request made by Mehul Choksi, the former chairman and managing director of Gitanjali Gems, who is a fugitive in the alleged Punjab National Bank (PNB) fraud case worth Rs 13,000 crores.

The judge has determined that there is initial evidence to suggest that Choksi and others may have committed criminal breach of trust and cheating, and therefore, the First Information Report (FIR) should not be dismissed.

In 2017, the city crime branch initiated the FIR following a complaint from a woman. She had invested money through a Gitanjali Jewellery franchisee in the city. However, the franchisee closed down, resulting in the loss of her investment.

The case named Digvijay Jadeja, who is the owner of the Divyanirman Jewellers franchisee, as well as Choksi, who served as the managing director of the Gitanjali Group, and two directors from the Gitanjali Group as the accused individuals.

Choksi's attorney presented the argument that Gitanjali Jewellery Retail Limited (GJRL), which is a subsidiary of the Gitanjali Group responsible for overseeing franchisee operations, did not transfer the investment made by the complainant to the franchisee. Additionally, Digvijay Jadeja failed to return the jewelry owned by GJRL or forward the proceeds from sales to the company.

The lawyer contended that the issue had been resolved through a settlement between the petitioners and the complainant. In a letter dated August 25, 2017, the complainant expressed her desire not to pursue the criminal proceedings any further. However, the High Court did not accept this defense or argument.

The court made an observation stating that at first glance, it appears that false promises were made through the franchisees, and subsequently, these showrooms were shut down, deceiving customers who had invested their money. The court noted that such incidents were not isolated, but rather they had occurred in various locations wherever Gitanjali Gems had established franchisees.

The court acknowledged that simply being directors doesn't automatically make them responsible for a criminal act. However, considering the serious nature of the allegations in this case, which involve a widespread scam conducted by Gitanjali Gems nationwide, the court held that the petitioners could not evade their liability at this stage of the legal proceedings.