Claim No. CFI 069/2024

IN THE DUBAI INTERNATIONAL FINANCIAL CENTRE COURTS

IN THE COURT OF FIRST INSTANCE

BETWEEN

(1) KESHAV GLOBAL TRADING LLC
(2) KESHAV GLOBAL PRIVATE LIMITED

Claimants

and

ETG COMMODITIES HOLDINGS LIMITED

Defendant

ORDER WITH REASONS OF H.E. JUSTICE SIR JEREMY COOKE

UPON the Part 7 Claim Form dated 26 September 2024 (the “Claim”)

AND UPON the Defendant’s Application No. CFI-069-2024/1 dated 20 November 2024 with supporting evidence seeking an order for inter alia security for costs (the “First SFC Application”)

AND UPON the Order with Reasons of H.E. Justice Sir Jeremy Cooke dated 19 March 2025 (the “Order”)

AND UPON the Defendant's Application No. CFI-069-2024/3 dated 30 June 2025 seeking an unless order compelling the Claimants' compliance with the Order and imposing sanctions upon the Claimants in the event of the Claimants' further non-compliance with the Order (the “Unless Order Application”)

AND UPON the Defendant's evidence in support of the Unless Order Application, the Claimants' written submissions dated 30 July 2025, the Defendant’s evidence in reply dated 7 August 2025, and the Claimant’s evidence dated 3 September 2025

AND UPON the Defendant’s Application No. CFI-069-2024/4 dated 22 August 2025 seeking further security for costs from the Claimants (the “Second SFC Application”)

AND UPON the Defendant's evidence in support of the Second SFC Application dated 22 August 2022, the Claimants’ evidence in answer dated 2 September 2025 and the Defendant’s evidence in reply dated 22 September 2025

AND UPON the Defendant’s evidence in support of the Unless Order Application dated 30 June 2025 and 7 August 2025, and the Claimants’ written submissions dated 30 July 2025 and evidence in answer dated 3 September 2025

AND UPON hearing Counsel of the Claimant and Counsel of the Defendant at the Preliminary hearing held on 11 December 2025 before H.E. Justice Sir Jeremy Cooke (the “Hearing”)

AND PURSUANT TO the Rules of the DIFC Courts (“RDC”)

IT IS HEREBY ORDERED AND DECLARED THAT:

1. The Answer to the Preliminary Issue has to be broken down into two limbs and the answers to those two limbs are as follows:

2. Costs are reserved but if there is no agreement between the parties within 7 days of the date of this Order on liability for costs or as to the quantum of costs payable:

3. The Claimant shall, if so advised, within 21 days from 11 December 2025, in accordance with the RDC:

Issued By:
Delvin Sumo
Assistant Registrar
Date of issue: 16 December 2025
At: 10am

SCHEDULE OF REASONS

1. The Preliminary Issue which I have to decide is framed as follows:

2. It should be noted that the Preliminary Issue refers to the Claimant’s Response to the Unless Order application dated 30 July 2025 and the Statement of Truth of the same date, when both should refer to 30 June 2025 and the Preliminary Issue is to be read accordingly. Whether the intention was to refer to paragraphs 38.2 and 38.3 of the Particulars of Claim rather than paragraphs 43.2 and 43.3 is less clear but the latter paragraphs set out the losses caused by the repayments to the Banks, which are set out in paragraphs 38.2 and 38.3 to which reference is made below.

3. I do not need to set out the history which led to the setting of this issue as a preliminary issue, save to say that the Defendant considered that it could constitute what amounted to a knockout blow if decided in its favour because there was only one minor claim for damages which did not depend on the alleged withdrawal of banking facilities from the Claimants which were said to have resulted from the alleged breaches of contract and/or duty on the part of the Defendant or those for whom it was responsible.

4. The point at issue is therefore a narrow one, as can be seen from its terms. The essence of the argument put forward by the Defendant is that there is no or no sufficient documentary evidence that the Claimants lost any banking facilities as the result of participating in transactions which involved fraudulent bills of lading presented as genuine documents to obtain payment from the Claimant’s bank, the Bank of India. The essential circumstances in which this situation is alleged to have arisen are constituted by a series of “circular” sales and purchases where the Claimant was the intermediate purchaser and seller from and to companies allegedly associated with the Defendants. There is no doubt that Claimant dealt with individuals who were employees of companies associated with the Defendant, if not the Defendant itself, and that these individuals, for whomsoever they were acting, made the arrangements for the circular sales in which the Claimants participated. These individuals therefore were responsible for the arrangements which resulted in the presentation of those documents, including the Bills of Lading which the Owners of the Vessel in question say are forged (and which does not appear to be disputed). These individuals with whom the arrangements were made are no longer employed by any company affiliated to the Defendants.

5. At the time of the application made by the Defendants to strike out the claim or for reverse summary judgment and at the time of ordering the preliminary issue, no documents had been produced by the Claimants to support the plea that their bank facilities with the Bank of India, the Bank of Baroda and Mashreqbank had been withdrawn but since that time the Claimants have given standard disclosure and have continued to produce documents showing their continued correspondence with the banks on these issues. There remains however a dearth of contemporaneous documents passing between the Banks and the Claimant at the material time. This is explained by the Claimants as being the result of a desire on both the part of the Claimants and the Banks not to escalate the situation in a way which could give rise to litigation or regulatory proceedings or issues, when the facilities could be closed by repayment without such regulatory complications or other proceedings. Throughout, Mr Garg maintained that the Claimants were innocent participants in the transactions with no knowledge of any fraud, forgery or dishonesty on the part of their counterparties. If the Banks had thought otherwise, it would seem that they would have had a responsibility to report to the regulatory authorities, although neither party referred me to the relevant regulations on this point.

6. Following the Court’s refusal of the Defendant’s strike out/ reverse summary judgment applications and the setting of the prelimimary issue as a primary issue of fact for resolution by the Court, arrangements were made for Mr Vyom Garg, the sole director and sole or major shareholder of each of the Claimants, to be cross- examined on matters relating to the Preliminary Issue at a hearing which took place on Thursday 11 December 2025. He confirmed, in his evidence in chief, the truth of the matters set out in the documents referred to in the Preliminary Issue. In addition, together with the skeleton argument submitted by Mr Sham Uddin who acted for the Claimant, a chronology was submitted which had been drafted by Mr Garg.

7. Although the Preliminary Issue is framed by reference to the terms of the documents referred to in it, it may be thought that the real question is whether or not the Bank of India and Bank of Baroda required the facilities which the Claimants had with them to be closed as a result of the participation of the Claimants in the transactions in question, whether or not every detail in those documents is completely accurate. The evidence before me establishes that to my satisfaction. The Banks would not have required the Claimants to close those facilities if the Claimants had not been party to the transactions set out in the Particulars of Claim, although the immediate focus of the Bank of India in December 2023 was on two transactions where SRY were the sellers, in one of which payment had been made and in the other where the Bank was refusing to pay, saying that the Bills of Lading in both these transactions were not authentic. The issue which I have to determine is, however, somewhat more complex for the reasons which appear below.

8. I find that the essence of Mr Garg’s account of his dealings with the Bank of India in Singapore, Dubai and Mumbai is accurate, as is his account of his dealings with the Bank of Baroda. But for the issues which arose in relation to the forged Bills of Lading, it seems that no issues would have arisen as to the use of the facilities being made by the Claimants because the “circular” nature of the transactions does not appear to have attracted any untoward comment. The discovery of forged bills of lading did of course attract the immediate attention of the Bank of India and led to the sequence of events which followed which resulted in the repayment of the facilities granted by both banks in circumstances where there would appear to be no reason why those facilities would not otherwise have been continued. I cannot say on the evidence before me, whether greater facilities would have been granted, which was what the Claimants were seeking from the Banks at the end of the year. At the time, the Claimants’ existing facilities at the Bank of India consisted of a USD 5,000,000 facility granted to the Second Claimant by the Bank of India in Singapore and a USD 4,000,000 working capital financing granted to the First Claimant by the same Bank through its branch in Dubai/DIFC. The facilities at the Bank of Baroda consisted of a USD 650,000 Trust Receipt Facility and an AED 2,700,000 Demand Loan Facility. All of these facilities were in fact repayable on demand.

9. In his evidence in chief, Mr Garg confirmed the accuracy of the documents in question and the chronology which he had drafted on which he was cross- examined.

10. In paragraph 38 of the Particulars of Claim, it is alleged that ‘as a consequence of (i) the issues with the veracity of the bills of lading ….and (ii) Keshav’s inability (through no fault of its own ) to prove the veracity of the bills of lading, Keshav’s banking facilities with both the Bank of India and the Bank of Baroda were severely impacted.’

11. In the Claimants’ Response to the Unless Application, Mr Garg stated that the Bank of Baroda, having been alerted to the fraudulent shipping documents by the Bank of India summoned Mr Garg and formally instructed that all outstanding facilities of the First Claimant be immediately settled in line with the measures adopted by the Bank of India. In the same statement, he said that on 7 February 2025, at a meeting at the Head Office of the Bank of India in Mumbai, he was told that unless all credit facilities were closed without delay the Bank would be compelled to initiate legal proceedings, including criminal referral, for forgery, fraud and AML violations. The Bank further advised that any continued exposure would pose significant regulatory risk for both the Bank and the borrower. To avoid the matter being formally documented in a way that could prompt regulatory escalation or damage Keshav’s reputation, Mr Garg expressly requested the Bank to refrain from issuing any written allegations or statements which could impair the Claimants’ standing with other institutions and the request was accepted on the strict condition that all facilities be closed.

12. Mr Garg’s witness statement of 3 September 2025 was to much the same effect with verbal demands for repayment by the Banks whilst saying that they would not put anything in writing or report to the authorities, thereby avoiding reputational damage and regulatory escalation for the banks. When in his statements he used the word “formal” in relation to warnings or demands, he said in cross examination that he did not mean that such warnings or demands had been made in writing but that they were formal in the sense of not being casual but clear as such.

13. There is no direct evidence before me from either bank save for a WhatsApp message of 24 October 2025 from the Bank of Baroda to Mr Garg and an emailed letter from the Bank of India of 13 November 2025 to Mr Garg who had been seeking confirmation from the Banks that the reason for the closure of the facilities was as the Claimants had pleaded. The correspondence shows Mr Garg pressing for responses and the Banks being slow to reply and apparently reluctant to put anything much in writing after the event concerning the closure of the facilities, the Bills of Lading and transactions in question, whether for the purpose of these proceedings or otherwise. The Banks’ responses were a little Delphic, but, when read in the context of the requests sent over a period of time and in the light of Mr Garg’s evidence which I accept, both show that it was the Banks which required closure of the facilities in question:

14. Whilst the Defendant’s case was that Mr Garg’s evidence was not credible because no bank would have failed to put in writing a demand for closure of facilities on the grounds put forward, I do not accept that. Mr Garg, was, on his evidence, telling the Banks that he was not party to any fraud in relation to forged bills of lading, which emanated from ETG which was a large and respected company dealing in agricultural products (amongst others). He had not, following the blocking of payment by the Bank of India for a shipment from SRY, and the challenge to the authenticity of the Bills of Lading involved in that transaction on 21 December 2023 and an earlier transaction where payment had already been made, been able to obtain any satisfactory answers from the people with whom he had been dealing whom he understood to be ETG employees. He was thus unable to demonstrate the authenticity of the Bill of Lading in the ensuing week or more in which he had said he would check out the position. The Bank of India had by then appreciated that there had been a number of similar trades.

15. Mr Garg was cross-examined, largely by reference to the Chronology and the Response to the Unless Order. It was put to him that the absence of any records disclosed by the Claimants of letters or messages from the two banks, the absence of emails and correspondence from the Claimants to them and the absence of internal written communications of the Claimants between individuals in their various locations meant that his version of events was not credible. He maintained the accuracy of the pleas, the Chronology, the Response and his witness statements.

16. In the Chronology Mr Garg had set out, in summary form, the history of his dealings with the Bank of India and the Bank of Baroda following information given to him on 21 December 2023 by Ms Bhanu his one employee in Singapore who had been contacted by the branch office of the Bank of India there. He said that all his communication with her was by telephone, save that documents relating to the underlying transactions must have been sent to her to present to the Bank of India in Singapore to show the bona fide nature of the purchases and sales from the Claimants’ perspective. He said that the contractual documents underlying the trades were provided to the Singapore branch and that he took with him to his meeting at the Head Office of the Bank in Mumbai further copies of those documents although at the meeting he gathered that the Head Office in fact had received copies from its Singapore branch. He was told by her on 21 December 2023 that Mr Somendra Singh, who was the manager of Trade Finance at the Singapore branch and the Second Claimant’s Relationship Manager, had said that a requested payment could not proceed because Bills of Lading presented for an earlier payment were not traceable on line and their authenticity was in doubt. Mr Garg was told that he should contact Mr Singh, which he then did by phone.

17. In that telephone conversation, Mr Singh told him that the Bills of Lading appeared to be forged in both transactions with SRY as sellers, and the Bank would not make the payment requested on the second transaction unless there was verification of their validity. Mr Garg asked for 5-7 days to check the position with the sellers who were, he said, part of the ETG Group which was a well known, large and reputable entity and most unlikely to be involved in any fraudulent bills. During that week he sought to gain confirmation of authenticity from his contacts, Mr Jain and Mr Gulati (including meetings on 23 and 27 or 28 December) but received no real assistance from them, they appearing to be unwilling to speak to him and saying nothing of help to show the genuineness of the Bills. By 3 January 2024, Ocean World Lines International had confirmed that a number of Bills of lading apparently issued by them had not in fact been issued by them in relation to 3 of the 5 trades set out in the Particulars of Claim. This led to formal letters of 3 and 8 January from the Claimants to ETG alleging that the Bills were forged. Later, after the events referred to in the following paragraphs of these Reasons, Mr Garg held a meeting with Mr Jain and Mr Gulati on 15 January, but did not obtain any information which would show the challenged bills to be genuine and on 18 January 2024, ETG said in a letter that the transactions were nothing to do with it.

18. Mr Garg kept Mr Singh and the Chief Executive of the Bank of India branch in Singapore updated on the position with his sellers, whilst the Bank was saying that no further outward transactions could be effected on the account despite Mr Garg’s explanations of his innocence in the matter. He sought to prevail on the Bank to allow other transactions to proceed whilst maintaining a block on the payment which had been stopped until the matter was clarified. He was told that, without establishing the veracity of the Bills of Lading, which he had been unable to do in the week or so following December 23, he would have to talk to the Bank’s Head Office in Mumbai and that the Singapore branch could not accede to his request. It would be for the Head Office to decide.

19. Mr Garg’s evidence was that the Claimant had been customers of the Bank of India for some 40 years (though not under the same name) and at no time had there even been any issue, with the Claimant fulfilling all its obligations to the Bank in that time without any default or complaint. As well-regarded customers of the Bank, the Bank was reluctant to take steps against the interest of the Claimants where the sellers to the Claimants had proffered false Bills of Lading which had then been used in the circular transactions. Mr Garg’s prior relationship with the Bank had been a very good one.

20. At that time, the First Claimant, was seeking to consolidate and enhance the existing credit facilities granted to the Claimants by the Bank of India (Singapore branch) by obtaining a USD 20 million facility with the Dubai/ DIFC Branch. The Dubai/DIFC branch, unsurprisingly, knew of the compliance issue raised by the Singapore branch as revealed when Ms Mitha Bhojwani, the Manager of the DIFC branch contacted Mr Garg to discuss the issue. Mr Garg went to visit the DIFC branch and said he had fixed an appointment to discuss the matter with Mr Sudhakar at the Bank’s Head Office and would act in accordance with the guidance given there. The question of enhancement of the facilities and further use of the Dubai facility was put on hold, whilst the Singapore facility remained frozen.

21. Mr Garg was also seeking an increased facility for the First Claimant from the Bank of Baroda in Dubai in the sum of USD 7.5 million. Mr Garg said that both the Bank of India and the Bank of Baroda are state controlled and they would liaise over the granting of facilities. Each would want to know what other facilities the Claimants had in deciding what financing they might be willing to provide. At all events, on Mr Garg’s evidence, the Bank of Baroda knew of the concerns that had been raised by the Bank of India and its approach to disallow further transactions on their facilities because, when Mr Ajit Pai of the Dubai branch of the Bank of Baroda telephoned him on 3 February 2024, he asked for clarification of the position. A meeting then took place at the branch on 4 or 5 February when Mr Garg was told that the Bank of Baroda’ compliance team had heard from the Bank of India of the issues relating to the Bills of Lading and had objected both to the proposal of increased limits and continuation of the existing facility. Although Mr Garg said that the Bills of Lading issues only related to transactions which involved the Bank of India, Mr Pai asked if there were other similar transactions to which Mr Garg replied that there were. Mr Pai said that no further transactions would be permitted under the existing facilities. The Bank of Baroda would put all the facility lines on hold as the Bank of India was doing. According to his chronology, Mr Garg, then, in order to avoid further escalation and additional complications, asked the Bank not to make any adverse report and gave assurances that the existing facility would be closed. In cross examination, he said that when faced with the prospect of no further financing being granted, he said he would close the account which was relatively small in order to avoid any possible legal or regulatory action. He told the Bank that any legal action against the Claimants or himself would not result in recovery as they would not be able to pay but he would close the account by repayment as soon as he could.

22. On 7 February, Mr Garg met with Mr Sudhakar, the General Manager of the Bank of India Head Office in Mumbai. The latter said that because of the long-standing relationship with the Claimants, the Bank had decided not to initiate any legal or regulatory action but that the Claimants had to clear all outstanding dues and close the facilities at once. Mr Garg sought to persuade him to allow other transactions to proceed and when it was clear that this would not be permitted, although Mr Sudakar remained adamant that the Singapore facility had to be closed immediately, he was prevailed upon to allow a longer period of up to 6 months for the Dubai facility to be closed but with prior verification of every Bill of Lading involved in any transaction.

23. There is documentary evidence for the repayment of the facilities, but it is true to say that no documents have been produced which set out the demands made by the two Banks to which Mr Garg referred. However, the only explanation for the immediate repayment of the Bank of Baroda facilities and the Bank of India Singapore facilities and for the repayment of the Dubai facilities within the 6 month period, is that given by Mr Garg. Documents attached to his witness statement of 6 November 2025 show that the Bank of India was careful later not to write anything in support of the Claimants’ case that might expose it to regulatory criticism or a fine and Mr Garg’s evidence is that this was their attitude at the time. If they were repaid the financing they had provided and with Mr Garg maintaining innocence of the fraudulent Bills of Lading, they were content to proceed on that basis without documenting reasons for the closing of the accounts. The sequence of events involving repayment is only explicable on the basis of the Banks’ demands that this occur as a result of their view of the compliance issues which arose in December 2023. The reluctance of the Banks to raise regulatory issues in these circumstances, whilst obtaining repayment of their facilities in full (with concomitant pain to the Claimants) appears to me to be the only realistic explanation for what occurred and is fully supported by the 2025 message and letter referred to in paragraph 13 above.

24. It may be, that, as a litigant in person, albeit represented by a Part 2 Advocate on a direct access basis, the Claimants and Mr Garg have not fulfilled their disclosure obligations in accordance with the order I made for standard disclosure by the Claimant in the English sense. His answers in cross-examination revealed a degree of confusion as to what he had disclosed and it appeared that he had not asked Ms Bhanu for documents in her possession. He gave inconsistent arguments about disclosure of internal documents but I accept his evidence that as the sole director of each of the Claimant Companies and as the only shareholder with his wife of both, there was not likely to be much by way of internal correspondence or memoranda recording events or conversations which were conducted over the phone or in meetings with the Banks. At one point he said that he provided more or less everything that he had and disclosed everything relevant whether adverse to his case or not but shortly afterwards said that he had not disclosed all internal documents as he was not relying on them.

25. Any such failures in disclosure do not affect my conclusions for the reasons given above. The essential account given by Mr Garg must reflect what occurred.

26. There remains however a difficulty where the Banks have not set out their reasons for demanding the closure of the facilities, because although it can be said that the closure occurred because the Banks required it, it is unclear whether the issue which caused the Banks to take the line that they did was the forged bills in themselves or the nature of the transactions in which the Claimants were involved in which the forged bills played a part. Mr Blackwood KC for ETG argued that whilst the forged Bills of Lading might have provided the trigger for the Bank of India to investigate the trades and the Banks would inevitably have been concerned about the fraudulent Bills which rendered the transactions fraudulent in themselves, the reason for demanding repayment by the Claimants of the facilities was not, or was not necessarily, caused by the fraud itself, which, on the Claimants’ own case, was not something to which they were party, but by the Bank’s views of the nature of the transactions themselves. The transactions themselves not only gave rise to the opportunity for such fraud but were not, on the Claimant’s own case, trades which they negotiated and concluded at arm’s length as real commercial transactions but were arrangements made on their behalf where the Claimants were said not to be exposed to risk. An examination of the Trades as set out in paragraphs 26 -37 of the Particulars of Clam and the alleged rationale for them, as set out in paragraphs 15-17 thereof, shows that on some of the trades, the Claimants appear to have made profits and on others losses, which does not readily fit with the rationale given. Trades 1, 3 and 5 appear to have given rise to losses on the difference between purchase and sale prices for the Claimants. The nature of the transactions themselves require explanation and a Bank might be concerned about them regardless of any fraud. The purpose of the trades as set out in paragraph 16, as well as the implied terms alleged by the Claimants against the Defendant might well be considerations for a financing bank in deciding whether or not to extend facilities, whether or not there were issues of regulatory compliance and whether to demand closure.

27. Mr Uddin for the Claimants argued that there was no real issue of causation involved in the present case and that what was put forward was a distinction without a difference since it was the fraud involved in the transactions as revealed by the forged Bills of Lading which was the concern of the Banks and the reason for demanding closure of the accounts, to which the Claimants were not party. The trades were sham because of the forged Bills of Lading. He also pointed out that the thrust of the Defendants’ arguments was directed at whether the Banks required closure by reason of the transactions at all, stressing the absence of any written demand. It does not seem to me that I can accept Mr Uddin’s argument because although it is clear that the Banks took exception to the trades in which the forged bills were presented (and for those which went through, the bills would have been utilised in both the Claimants’ purchases and onward sales), the transactions themselves, on the Claimants’ own case were not arm’s length commercial transactions from the Claimant’s perspective. In the absence of evidence from the Bank as to the exact reasons for requiring closure of the facilities or any documents which set out the basis for their decisions, all that I can conclude on the evidence before me is that they required closure after discovering the existence of the forged bills in the context of the transactions for which the contractual documents were provided to them by the Claimants. They demanded closure on seeing the transactions and the Bills of Lading. Whether their concern was with one or the other or both cannot be determined at this stage and what was the effective cause of their demand for closure cannot be established now. Mr Uddin may well be right in saying that it makes no difference to his case on causation of loss at the end of the day, but I cannot say that at this stage of the proceedings on the evidence available to me

28. In these circumstances, whilst I can answer the first limb of the preliminary issue, I cannot answer the second limb without further evidence which may or may not be forthcoming in due course, depending on the stance taken by the Banks in relation to these proceedings and/or the provision of their own documents which might reveal the reasons for their decisions. Thus, the answers, if the Preliminary Issue is broken down into two limbs are as follows:

29. This is an unsatisfactory conclusion and illustrates how the ordering of preliminary issues as a desired short cut can fail to achieve that objective. There are two points to be made in that context:

30. In these circumstances, whilst I make no order as to costs of the Preliminary Issue now, because the parties have not had the opportunity to make submissions on the point in the light of this judgment and reasons, it appears to me that not only has the Claimant won on the first limb of the issue but the Defendant has failed, both in relation to the first and second limbs of the issue, to establish the knockout blow it sought. I consider therefore, prior to any submissions that the parties wish to make, that the Defendant should pay the Claimant’s costs of the Preliminary Issue. If there is no agreement within 7 days on liability for costs or as to the quantum of the Claimants’ costs payable in the light of that indication: