A Belgian court has denied bail to Mehul Choksi, the fugitive diamond merchant wanted in India in connection with the ₹13,500 crore Punjab National Bank (PNB) fraud case. The decision was made in light of Choksi's past attempts to evade the law.

Choksi, the owner of Gitanjali Group, was arrested in Belgium in April following an extradition request from the Central Bureau of Investigation (CBI). The CBI argued that Choksi had previously fled multiple jurisdictions to avoid legal proceedings and could abscond again if released.

Choksi's lawyer, Vijay Aggarwal, confirmed that the bail plea of his client was rejected during a court hearing. According to news agency ANI, a three-judge bench heard the arguments before ruling against granting bail. Choksi will contest his extradition from jail custody.

In his bail plea filed on August 22, Choksi offered to remain under house arrest with surveillance; however, the appeal court dismissed it. His legal team had previously cited Choksi's poor health and ongoing cancer treatment as the main grounds for his release. They also argued that Choksi has community ties and should not be considered a flight risk if granted bail.

The CBI is assisting Belgian prosecutors with case files, evidence, and legal arguments and has also engaged a European law firm to strengthen the extradition case. Indian agencies have shared two open-ended arrest warrants, issued by a special court in Mumbai in 2018 and 2021, as part of the request.

Choksi and his nephew Nirav Modi are accused of masterminding the PNB fraud through fraudulent Letters of Undertaking (LoUs) and Foreign Letters of Credit (FLCs), allegedly issued by some PNB officials at the bank's Brady House branch in Mumbai. These instruments enabled Choksi's companies to obtain loans from several overseas banks without proper approvals or security. When Choksi's firms failed to repay, PNB had to cover the liability, paying over ₹6,344 crore, including interest, to the foreign banks involved.

The PNB scam, involving fraudulent Letters of Undertaking, was exposed in 2018, revealing systemic loopholes. According to the CBI chargesheet, Choksi, his firm Gitanjali Gems, and others committed the offense of cheating against PNB in connivance with certain bank officials by fraudulently getting LoUs issued and got FLCs enhanced without following prescribed procedure, causing a wrongful loss to the bank. The ED also filed money laundering cases under the Prevention of Money Laundering Act (PMLA).

Choksi left India on January 2, 2018, and is wanted by the CBI and the ED for allegedly defrauding the PNB. He had taken citizenship of Antigua and Barbuda in 2017 and was residing there since. In May 2021, Choksi was apprehended in Dominica for illegal entry. India appealed to Dominica for extradition, but Choksi was sent back to Antigua and Barbuda.

While Choksi is facing extradition proceedings in Belgium, Nirav Modi has been in custody in London since his arrest in March 2019. In February 2021, the Westminster Magistrates' Court ruled that there was a prima facie case against him and allowed his extradition to India.