The Enforcement Directorate (ED) on Friday arrested Jet Airways founder and former chairman Naresh Goyal in a money laundering case associated with an alleged fraud of ₹538 crore at Canara Bank.
Goyal, 74, was taken into custody under the Prevention of Money Laundering Act (PMLA) following a long session of questioning at the central agency's office in Mumbai.
The former chairman is expected to be produced before a special PMLA court in Mumbai on Saturday where the ED will seek his custodial remand, news agency PTI reported citing the officials.
The ED had carried out raids against Goyal and others involved in the bank fraud case in July this year after Central Bureau of Investigation (CBI) launched FIR against Jet Airways (India) Limited, Naresh Goyal, his wife Anita Naresh Goyal, Gaurang Ananda Shetty and unknown Public Servant(s) and Private Person(s) in connection with ₹538-crore fraud case at the Canara Bank.
Why did ED take Naresh Goyal in its custody?
1. Jet Airways, founded by Naresh Goyal, a non-resident Indian (NRI) businessman, in April 1992 as a limited liability company, shut its operations in April 2019, after running out of cash.
{{/usCountry}}1. Jet Airways, founded by Naresh Goyal, a non-resident Indian (NRI) businessman, in April 1992 as a limited liability company, shut its operations in April 2019, after running out of cash.
{{/usCountry}}2. He stepped down from the Board of Jet Airways along with his wife in March 2019 amid the financial crisis.
3. The CBI FIR was registered against Goyal after the bank alleged sanctioning credit limits and loans to Jet Airways (India) Ltd (JIL) to the tune of ₹848.86 crore of which ₹538.62 crore was outstanding.
4. The CBI later declared the account as "fraud" in July 2021.
5. "As per sample agreement of Jet Airways (India) Ltd (JIL), it was noted that the expenses of General Selling Agents (GSA) was to be borne by GSA itself and not by JIL. However, it was observed that JIL has paid various expenses amounting to ₹403.27 crore which is not in tune with the GSA," the complaint now part of the CBI FIR alleged.
6. The bank further claimed that the forensic audit of the airline showed that it paid "related companies" ₹1,410.41 crore out of a total commission expenses, thus siphoning off funds from JIL. Even the personal expenses such as salaries of staff, phone bills and vehicle expenses among others of the Goyal family were paid paid by JIL.
7. The funds were also siphoned off through Jet Lite (India) Ltd (JLL) by making advance and investing and subsequently writing off of the same by making provisions.
8. JIL has also been reported to have diverted the funds for subsidiary JLL in the form of loans and advances and investments extended.
(With inputs from agencies)