A case has been reported involving a jeweller from Surat accused of defrauding a Mumbai-based jewellery firm of ₹1.84 crore in raw gold.
The central figure in the case is Gautam Wagh, owner of Apeksha Jewels Private Limited in Surat, and his business dealings with Prism Enterprises, based in Mumbai, which supplies jewellery to stores and boutiques.
Details of the Transaction and Allegations
In 2021, Prism Enterprises, led by Romil Sanghvi, initiated a business relationship with Gautam Wagh, with the agreement that Wagh would produce jewellery from the raw gold supplied by Prism at reasonable rates. Initially, Wagh fulfilled orders on time, which led to further engagements. However, from February 2021 to April 2022, it is alleged that Wagh neither returned the finished jewellery nor the raw gold, totaling over 3 kg of 24-karat gold, estimated to be worth around ₹1.84 crore.
“Giving Prism attractive rates, a lot less than the prevailing market rate, Wagh accepted work of making gold and diamond jewellery for the firm. He used to take raw gold and in seven days supply the finished jewellery for which he used to get money in terms of a Memorandum of Understanding entered into between them in February 2021,” stated a police officer.
Legal Action and Implications for the Industry
Prism Enterprises attempted to recover the gold multiple times without success, leading them to file a complaint against Wagh. The NM Joshi Marg police station registered the case under section 409 of the Indian Penal Code, related to criminal breach of trust, and an investigation is ongoing.
This incident points to potential vulnerabilities within the jewellery industry concerning trust and security in transactions involving significant amounts of valuable materials. It suggests a need for businesses to possibly enhance their verification processes and terms of engagement to safeguard against similar issues. The situation also highlights the importance of conducting thorough background checks and establishing clear, enforceable agreements.
“They learned that the address given by Wagh was also fake and no company existed at the address given by him. Initially, he promised to deliver the jewellery in time, however, later they could not reach him. On searching the GST portal, it was found that Wagh’s business was closed,” stated the police officer.
Recommendations for Industry Stakeholders
For industry stakeholders, this case serves as a reminder of the risks associated with large asset transactions. It emphasizes the need for enhanced transparency and accountability mechanisms, particularly in long-term deals.
This event also brings to light the potential for financial and reputational impact from associations with fraudulent activities, underlining the need for maintaining ethical standards and promoting a culture of trust and respect within the industry for long-term sustainability.
