New Delhi, September 2, 2023: Jet Airways founder Naresh Goyal was arrested by the Enforcement Directorate (ED) on Friday night in an alleged ₹ 538-crore money laundering case linked to loans and credit lines given to the airline by Canara Bank.
Goyal was taken into custody under the Prevention of Money Laundering Act (PMLA), following a long session of questioning at the ED’s office in Mumbai, according to media reports.
He is expected to be produced before a special PMLA court in Mumbai on Saturday.
Canara Bank had filed a complaint in May against the airline, Goyal, his wife and a former airline director for “causing wrongful loss” to the lender.
According to the bank’s complaint, when Goyal’s companies started defaulting on repayment of loans availed from the consortium, the bank called in a forensic auditor to scrutinise all transactions and documentations processed between April 1, 2011 and June 19, 2019.
The bank had sanctioned credit limits and loans to Jet Airways (India) Ltd (JIL) amounting to ₹ 848.86 crore, of which ₹ 538.62 crore has not been repaid.
The forensic audit report, submitted on February 10, 2021, pointed out “glaring irregularities”.
According to the CBI, the audit report found fraudulent features such as diversion and siphoning of funds by the accused companies.
The CBI had said the account was declared “fraud” in July 2021. It has accused Jet Airways and its founders of siphoning funds. According to the agency, between April 1, 2011, and June 30, 2019, the airline was found to have spent ₹ 1,152.62 crore on professional and consultancy expenses.
Suspicious transactions to the tune of ₹ 197.57 crore were identified among entities linked to the airline, with key managerial personnel also allegedly being connected to these entities.
The investigation found that Jet Airways paid ₹ 420.43 crore of the total ₹ 1,152.62 crore in professional and consultancy expenses to entities whose business nature did not match the service descriptions on their invoices.
Even personal expenses, such as salaries of staff, phone bills and vehicle expenses, among others, of the Goyal family were paid by JIL, said the FIR.
Once country’s biggest private airline, Jet Airways ran out of cash in April 2019 and filed for bankruptcy. It was supposed to resume operations by the first quarter of 2022 under its new owners.
