Mumbai, March 5: The Economic Offences Wing (EOW) of the Mumbai Police on Thursday arrested Sushil Kantilal Jain (42), a partner of KSK International, in connection with an alleged ₹10 crore investment fraud case.
Jain was produced before the Esplanade Court, which remanded him to police custody till March 7. His wife and co-accused, Priyanka Jain, has been granted anticipatory bail by the court in the case.
Complaint by businessman
The case came to light after a 29-year-old businessman from Parel filed a complaint alleging that he and another investor were duped by the partners of KSK International on the pretext of offering equity partnership, high profits and assured monthly returns.
According to the FIR, Siddharth Mukeshkumar Mudhalia (29), who assists in his family business K. Madhu Jewellers Pvt. Ltd., alleged that Sushil Jain and his wife Priyanka Jain lured him into investing in their artificial kundan jewellery manufacturing business allegedly operating from Bhiwandi. The accused reportedly promised him an 11% equity stake in the company, 50% profit sharing and 12% annual interest on the investment.
Investment based on alleged false claims
As per the FIR, Jain first approached Mudhalia in July 2022, claiming that KSK International was manufacturing around 10,000 imitation jewellery pieces every month and generating a monthly turnover of about ₹5.5 crore with an annual profit of ₹4 crore. To gain the complainant’s trust, Jain allegedly presented printed documents and financial statements.
Believing the claims, Mudhalia signed a Memorandum of Understanding (MoU) on August 19, 2022, and gradually invested ₹3 crore between August 2022 and March 2024 through cheques and RTGS transfers into the company’s bank account.
Later, on Jain’s recommendation, another investor, jeweller Shailesh Shah of S. Mahendrakumar Devichand, also invested ₹2 crore after being promised 12% annual interest.
A second MoU dated April 1, 2024, was signed in which Jain allegedly assured Mudhalia that he would receive 10% equity shares once the total investment reached ₹10 crore, along with monthly balance sheets, profit distribution and financial transparency.
Alleged diversion of funds
Subsequently, Mudhalia invested an additional ₹5 crore between May and November 2024. In total, Mudhalia invested ₹8 crore while Shah invested ₹2 crore, taking the total investment to ₹10 crore.
However, despite repeated requests, Jain allegedly failed to provide balance sheets, sales data, financial statements or proof of business operations. The investors also did not receive any interest or share of profits.
During inquiries, a former manager of KSK International reportedly revealed that the company existed only on paper and that the funds were allegedly being diverted for personal use.
Investigators also found that Jain claimed to have purchased machinery worth ₹2 crore in cash but allegedly refused to disclose the supplier details. In 2025, the firm was converted into “K. Sushil K International Pvt. Ltd.”, but Mudhalia was not allotted any equity shares despite the agreement.
Police action and investigation
In September 2024, Jain allegedly issued a written assurance promising to return the invested amount by March 31, 2025, and to pay ₹50 lakh to Shailesh Shah by April 2025. However, the accused allegedly failed to honour the commitment.
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After suspecting fraud, Mudhalia approached the Economic Offences Wing. Following a preliminary inquiry, an FIR was registered at LT Marg Police Station against Sushil Jain and Priyanka Jain for allegedly cheating investors of ₹10 crore under the false promise of business partnership and profit sharing.
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