Late on Friday night, official sources reported that the Enforcement Directorate (ED) had arrested Naresh Goyal, the founder of Jet Airways, in connection with a money laundering case tied to an alleged bank fraud amounting to ₹538 crore at Canara Bank.
Goyal was apprehended under the Prevention of Money Laundering Act (PMLA) following an extensive interrogation at the ED's central office. Canara Bank had lodged a complaint in May, accusing the airline, Goyal, his spouse, and a former airline director of causing financial harm to the bank.
At the age of 74, Naresh Goyal is scheduled to appear before a specialized PMLA court in Mumbai on Saturday, where the Enforcement Directorate (ED) intends to request his custody.
This move comes in response to an FIR filed based on Canara Bank's complaint, which asserted that they granted credit limits and loans amounting to ₹848.86 crore to Jet Airways (India) Ltd (JIL), with an outstanding balance of ₹538.62 crore.
The CBI had officially labeled the account as "fraudulent" on July 29, 2021.
The bank's allegations include findings from a forensic audit of JIL, indicating that substantial commission expenses, totaling ₹1,410.41 crore, were directed towards "related companies," resulting in the diversion of funds from JIL.
According to the provided sample Agreement of Jet Airways (India) Ltd (JIL), it was explicitly mentioned that the General Selling Agents (GSA) were responsible for covering their own expenses, not JIL.
Nevertheless, the complaint, which has been incorporated into the CBI FIR, alleges that JIL made payments totaling ₹403.27 crore for various expenses, which deviates from the terms outlined in the GSA agreement.
1. Jet Airways, established by Naresh Goyal, a non-resident Indian (NRI) entrepreneur, as a limited liability company in April 1992, ceased its operations in April 2019 due to financial insolvency.
2. In response to the financial crisis, Goyal and his wife resigned from the Board of Jet Airways in March 2019.
3. The CBI initiated a First Information Report (FIR) against Goyal based on allegations made by a bank, which claimed that Jet Airways (India) Ltd (JIL) had been granted credit limits and loans amounting to ₹848.86 crore, with ₹538.62 crore remaining unpaid.
4. Subsequently, the CBI declared the account as fraudulent in July 2021.
5. The complaint, now included in the CBI FIR, points out that the sample agreement of Jet Airways (India) Ltd (JIL) specified that General Selling Agents (GSA) were responsible for covering their own expenses, not JIL. However, it was observed that JIL had made payments totaling ₹403.27 crore for various expenses, contrary to the terms of the GSA agreement.
6. The bank additionally asserted that a forensic audit of the airline revealed that substantial commission expenses, amounting to ₹1,410.41 crore, were directed towards "related companies," resulting in the diversion of funds from JIL. Moreover, personal expenses such as salaries of Goyal's family members, phone bills, and vehicle expenses were allegedly covered by JIL.
7. Funds were also redirected through Jet Lite (India) Ltd (JLL) by means of advances, investments, and subsequent write-offs.
8. JIL was reported to have channeled funds to its subsidiary, JLL, in the form of loans, advances, and investments.