CBI registers 7th case against Jatin Mehta

New Delhi: The CBI has registered a fresh case against diamond merchant Jatin Mehta, of Winsome Diamonds and Jewellery, embroiled in a bank loan default case of nearly Rs 7,000 crore, making it the seventh FIR by the probe agency in the case.

Mehta, his wife, and son were charge-sheeted by the Central Bureau of Investigation in June 2018 in the case, where Mehta's Winsome Diamonds and Forever Precious Jewellery along with his son Suraj's Su-Raj Diamonds had declared that they would not be able to pay back the loans due to losses suffered by their buyers, 13 companies in the United Arab Emirates.

In the latest FIR, the probe agency names Jordanian national Hathyam Salman Ali Abu Obeidah, who held the power of attorney for the 13 buyer companies based in the UAE.

According to the latest complaint from Bank of India, it was found that Obeidah was controlling the 13 companies allegedly on behalf of Mehta and that there might be evidence of criminal conspiracy in declaring USD 1 billion losses by these firms.

Mehta's companies had purchased gold bullion from foreign banks against Standby Letters of Credit issued by a consortium of around 14 Indian Banks.

According to the previous cases registered by the CBI in the case, the SBLC issuing banks included Central Bank of India, IDBI Bank, Vijaya Bank, and now Bank of India. So far, the total loan default that CBI has registered cases against amounts to nearly Rs 1,500 crore.

When Mehta's companies declared that they would not be able to pay the loan amount to the banks for the gold purchased, the foreign banks, which included the Bank of Nova Scotia, Standard Bank PLC London, and Standard Chartered Bank came for the money to the banks that had issued SBLCs.

This cost each bank in the consortium of lenders several hundreds of crores as a result.

Both Mehta and his wife had fled the country in 2016, just after the Enforcement Directorate had issued orders for provisional attachment of some of their properties.

They acquired citizenship of St Kitts and Nevis in 2013, as reported by this paper last year. India does not have an extradition agreement with the Caribbean country. After the NDA government came in, there was a lot of hoopla about going after Mehta and finding ways to bring him back here to face Indian law.

Earlier this year, the Indian government had plans to get Mehtas' passports cancelled. The CBI had also looked at ways to have Red Conrner Notices issued against the Mehtas. However, CBI and ED have failed to make any major breakthrough in extraditing the couple so far. While the Caribbean country has previously cancelled passports of citizens with a dubious past, it remains to be seen whether this diamond merchant from Gujarat also manages to evade Indian agencies.

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