ICICI Bank move against Antwerp diamond merchants upheld

|By Arabian Post Staff|The London High Court has upheld the injunction granted to ICICI Bank UK against leading diamond merchant family of Mehtas, considered legends in the diamond trading business and pioneers in Indian industry’s inroads to Antwerp.

This means that the well-known Mehta family of Belgium lost their bid in London’s High Court to unfreeze certain of their family members’ assets, as they continue to be pursued by ICICI Bank UK for an $8 million debt following the default on a loan made to their family’s company Jayam NV. A prominent diamond trading company and former sight holder with De Beers, Jayam NV began experiencing financial difficulties and in June 2016 went into voluntary liquidation. Mihir Mehta was also convicted in Belgium of fraud-related offences.

ICICI Bank UK was first granted an injunction against Mihir Mehta, his two sisters Mona and Manisha, and their mother Purnima in March 2017 as the bank became concerned that the family had been moving assets from the trading firm’s holding company to avoid paying the remainder $8 million debt of the total loan amount.

In contesting the injunction, Mihir Mehta argued that since he was resident in Belgium he should not be subject to English jurisdiction. However, the personal guarantees on which the Bank’s case is founded, which included  a Belgian law and Belgian jurisdiction clauses, did not necessarily prevent the bank from starting its claim in England.  Mihir Mehta’s sisters Mona and Manisha lived in England, and this was another factor pointing to England as the proper place for the claim.

Mihir Mehta said in evidence to the court that his conviction and 18-month suspended sentence followed a group trial of more than 100 diamond traders relating to fraudulent exports. He claimed he was not seriously involved and that the conviction was political. Emotional fatigue arising from several disputes he was fighting prevented him from appealing the decision, he said. However, Judge David Waksman decided that in light of his convictions in Belgium and the evidence filed in court, Mihir Mehta was someone who represented a risk of dissipation and continued the injunction against him.

In his ruling, Judge David Waksman said, “Mihir is proper party to the claim against Mona and Manisha and the court does have jurisdiction over the claim against him as an heir. That the children might not have foreseen that they would become liable for their father’s debts also does not seem to me to have any relevance to the question of jurisdiction.”

Mihir’s father, Mahendra Mehta died unexpectedly in 2009, leading to a family dispute over the father’s assets, with Manisha starting proceedings in India against her siblings and cousins regarding what she considers to be her right in a valuable family in the Malabar Hill area of Mumbai, according to court documents.

After the initial freezing order had been served on her, Mona Mehta formally rejected her father’s inheritance and the court discharged the injunction against her alone.  Mahendra’s wife Purnima, two corporate defendants, and Manisha have not objected to the freezing order continuing against themuntil trial.

ICICI Bank UK was represented by Zaiwalla & Co, Michael Brindle QC of Fountain Court Chambers, and Simon Goldstone of 4 Pump Court.