Indian Supplier holding stock and Funds and blackmailing for more

Dear Sir/Madam Please can you help me. I am in a very serious situation with a supplier in India. He owns a shipping company. He sent me a quote for goods he has on hand in his warehouse. Last week Friday 6th May 2016 he sent the quote and the invoice and he also confirmed in writing that as soon as we pay he will release the goods to TNT and fly to South Africa. We paid him in Full and he insisted it must be via Western Union so he gets the funds immediately. Now instead of flying the goods, he is holding them and demanding more payment. We cannot send anymore because we have no more funds to send, we sent all our funds to him, now he wants more and more and more USD, he has my stock worth USD2500 and I paid him USD705 for freight via Western Union, now he insists more charges one week after begging for the tracking number. I told him I will pay the USD350 fee's but only after we receive the goods, but he refuses. He also told us that he is using third party warehouse and that the warehouse won't release the goods, then he gave me his sister's number and told me it was his warehouse guy, when I discovered he was cheating she blocked me and he quickly told me his sister has own warehouse company, but actually there is no warehouse company, it is only two small boxes in his office. Please help me, I don't know what to do, my client that paid them the funds of USD705 is going to report me for theft at the police in SA today and there is nothing I can do, this Mr Shailendra Kumar from Online Express is keeping my stock and my USD for freight and not flying the goods. Please please help me.