A special court in Mumbai on Friday rejected diamond merchant Mehul Choksi's petition against a notice issued to him on the Enforcement Directorate's (ED) application seeking to declare him a Fugitive Economic Offender in the multi-million dollar Punjab National Bank (PNB) scam, news agency PTI reported.

Special judge for cases under the Prevention of Money Laundering Act (PMLA), SM Menjoge, noted that the court order issuing the notice was not based on the "wrong facts or mistaken assumptions".

Choksi and his nephew Nirav Modi are the prime accused in an alleged fraud at PNB that came to light in 2018, PTI reported.

The diamond merchant, in his plea filed through advocates Vijay Agarwal and Rahul Agarwal, claimed that the central probe agency kept changing its arguments regarding the evidence and grounds on the basis of which it wants him declared an FEO.