Company Fined ₹30 Lakh; Directors Bakul Zaveri and Mazhar S. Kapadia Sentenced to Five Years’ Rigorous Imprisonment
AHMEDABAD, SEPTEMBER 10: A CBI Court in Ahmedabad has convicted M/s Kushal Diamonds Ltd. and two of its directors in a long-pending case involving criminal conspiracy and cheating, sentencing the company and its directors to fines and imprisonment.
According to a press release issued by the Central Bureau of Investigation (CBI), the court on September 8, 2026, convicted and sentenced the private company, its Chief Managing Director Bakul Zaveri, and Director Mazhar S. Kapadia.
The court imposed a fine of ₹30 lakh on M/s Kushal Diamonds Ltd. Both Bakul Zaveri and Mazhar S. Kapadia were sentenced to five years’ rigorous imprisonment (RI) and fined ₹30 lakh each.
Case Dates Back to 2000
The CBI had registered the case on March 15, 2000, against officials of the National Small Industries Corporation (NSIC), Ahmedabad, and others.
The accused included Virendra Kumar Sawhney, Rohit Dhingra and Ram Avatar Agarwal, who were then serving as public servants in different capacities at NSIC.
The investigation alleged that the NSIC officials entered into a criminal conspiracy with the directors of M/s Kushal Diamonds Ltd., Mumbai, in connection with the disbursement and adjustment of funds under NSIC schemes.
NSIC Disbursed Over ₹2.34 Crore
According to the CBI investigation, NSIC had disbursed funds amounting to approximately ₹2.34 crore (₹2,34,85,081) to Kushal Diamonds Ltd. under the Bill Discounting Facility and Raw Material Assistance Scheme.
The investigation further revealed that funds amounting to around ₹1,34,88,717 were disbursed but adjusted against past outstanding amounts, payments received through cheques/DD, payments from overseas buyers and earnest money deposits.
The CBI stated that the final outstanding amount against Kushal Diamonds Ltd. as on March 31, 1996, stood at ₹99,96,364, which was treated as wrongful loss to NSIC Ltd.
Chargesheet Filed Against Eight Accused
After completing the investigation, the CBI filed a chargesheet on January 8, 2002, against eight accused, including the private company, its three directors and four NSIC public servants.
The accused private persons named in the chargesheet were Bakul Zaveri, Mazhar S. Kapadia and Subhash Chhanana, along with the concerned NSIC officials.
Four Public Servants Acquitted
After conclusion of the trial, the court convicted and sentenced the accused in accordance with its findings.
The CBI release stated that the public servants—Virendra Kumar Sawhney, Rohit Dhingra, Ram Avtar Agarwal and Rajesh Arora—were acquitted of the charges levelled against them.
Meanwhile, accused Subhash Chhanana died during the course of the trial, following which the case against him was abated by the court.
The conviction marks the culmination of a case that originated more than two decades ago and involved alleged financial irregularities in the disbursement and adjustment of funds under NSIC assistance schemes.
