London Court Holds Nirav Modi Liable to Bank of India Under Personal Guarantee

A London commercial court has held Nirav Modi liable to Bank of India under a personal guarantee for a principal debt of USD 4.1 million.

What Happened

The London Circuit Commercial Court has held Nirav Modi liable to Bank of India under a personal guarantee he signed in connection with a loan facility extended to Firestar Diamond FZE, a Dubai-incorporated company. Judge Simon Tinkler, sitting as a Deputy High Court Judge, handed down the judgment on 23 June 2026.

The court held that Modi was validly served with the bank’s October 2025 demand and that the demand related to a liability owed to the bank under the guarantee. It also held that the personal guarantee was not void or unenforceable as a matter of Indian law.

The principal amount due was USD 4,105,189.34. The judgment provides that interest calculated on the basis accepted by the court is to be added to that principal in determining the total amount payable.

The court reached its conclusions after considering Indian-law expert evidence. Modi had defended the claim by arguing, among other things, that the personal guarantee was unenforceable under Indian law and that valid demands had not been served on him. The court rejected those arguments and found in favour of Bank of India on the issues before it.

Background & Context

The dispute arose from a facility agreement between Bank of India and Firestar Diamond FZE. The original facility agreement dates from 2012 and was amended and restated in 2013. Around the same period, Modi signed the personal guarantee. The facility agreement was governed by English law, while the guarantee itself was expressly governed by Indian law.

That choice of governing law was significant. Although the proceedings were before an English court, the court had to determine questions about the validity and enforceability of the guarantee under Indian law. The judgment records that expert evidence was permitted on Indian-law issues, including whether the guarantee was void or unenforceable under the Foreign Exchange Management (Guarantees) Regulations 2000.

Bank of India made demands for repayment after Firestar Diamond FZE failed to repay the relevant amounts. The court records that a further demand was served on Modi in October 2025.

Reports state that Modi argued that the guarantee was unenforceable and that the bank had not made valid demands under it. Those were defence positions in the civil proceedings and were rejected by the court.

The judgment itself makes an important distinction from other proceedings involving Modi. It records that fraud allegations had led to separate investigations and criminal proceedings, but expressly states that no such fraud had been proved and that the civil claim before the court did not allege that Modi or his companies had committed fraud.

According to a statement by Bank of India’s lawyers reported after the judgment, the decision therefore does not make findings on the wider fraud allegations or the separate Punjab National Bank matter.

Key Details

• Court/Forum: London Circuit Commercial Court, High Court of Justice, King’s Bench Division, at the Rolls Building, Royal Courts of Justice.
• Judge: Judge Simon Tinkler, sitting as a Deputy High Court Judge.
• Date: Judgment handed down on 23 June 2026.
• Case: Bank of India v Firestar Diamond FZE & Ors, [2026] EWHC 1565 (Comm).
• Parties: Bank of India v Firestar Diamond FZE, Firestar International Private Limited and Nirav Deepak Modi.
• Governing law: The facility agreement was governed by English law, while the personal guarantee was governed by Indian law.
• Principal amount: USD 4,105,189.34, with interest to be added in accordance with the judgment.
• Total reported by media: LiveLaw and some other reports put the amount including interest at more than USD 11.5 million, while other reports have put it at about USD 10.7 million. These figures are reported estimates and should not be treated as a single confirmed total.
• Current status: Judgment delivered in favour of Bank of India; no appeal or subsequent enforcement step was confirmed in the sources reviewed.

Why It Matters

The judgment is a useful example of how a cross-border commercial dispute can require an English court to apply the law of another country to part of the contractual relationship.

Here, the court applied Indian law to the personal guarantee because that was the law chosen for the guarantee, even though the underlying facility agreement was governed by English law. The court considered expert evidence on Indian law before concluding that the guarantee was not void or unenforceable and that the bank had made a valid demand.

For law students and practitioners, the case also illustrates the practical importance of the demand mechanism in a guarantee. Once the court found that the relevant demand had been validly served and related to a liability covered by the guarantee, it held Modi liable for the principal debt.

The judgment should nevertheless be read within its proper limits. It is a civil recovery decision concerning a personal guarantee and a contractual debt. It is not a finding of criminal guilt, and it does not determine the merits of the separate fraud allegations or criminal proceedings involving Modi. The judgment itself expressly states that no fraud had been proved in the proceedings before the court.

Closing

The London Circuit Commercial Court has therefore held Nirav Modi liable to Bank of India under his personal guarantee for the unpaid principal of USD 4,105,189.34, together with interest calculated in accordance with the judgment.

The decision turned on the enforceability of the guarantee, the validity of the bank’s demand and the liability arising under that guarantee. It should not be read as a determination of the separate criminal or fraud-related proceedings involving Modi.