One fine day, Jet Airways founder Naresh Goyal was arrested by the Enforcement Directorate (ED) in an alleged Rs 538 crore money laundering case linked to loans and credit lines given to the airline by Canara Bank. Naresh Goyal orchestrated a large-scale financial fraud through the systematic diversion of JIL’s funds, concealing them as overblown General Sales Agent (GSA) commissions and making substantial, inexplicable payments to various professionals and consultants. The money laundering case was made when a first information report (FIR) was made against Jet Airways, Goyal, his wife Anita, and some former company executives, which was registered by the CBI on May 3. The bank had approached the agency and said that it had sanctioned credit limits and loans to Jet Airways (India) Ltd. (JIL) amounting to Rs 848.86 crore, of which Rs 538.62 crore have not been repaid.
According to the agency, between April 1, 2011, and June 30, 2019, the airline was found to have spent Rs 1,152.62 crore on professional and consultancy expenses. Suspicious transactions to the tune of Rs 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 Rs 420.43 crore of the total Rs 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.
Goyal was taken into custody following a long session of questioning at the ED’s office in Mumbai. On May 5, the premises of the Jet Airways founder and the old offices of the airline were raided by the CBI in connection with the Canara Bank fraud. The ED had also searched eight locations linked to Goyal and his associates in July. Jet Airways, once India’s largest private carrier, suspended operations in April 2019 because of a severe cash crunch and mounting debt.
The airline was acquired by a partnership between UAE-based businessman Murari Lal Jalan and London-based Kalrock Capital in June 2021, after a protracted insolvency process. Due to a significant shortage of funds and an increasing amount of debt, Jet Airways, which was previously India’s biggest private airline, suspended operations in April 2019. In June 2021, a prolonged insolvency process resulted in the acquisition of the airline by a partnership between Murari Lal Jalan, a businessman based in the UAE, and Kalrock Capital, based in London
There are many business houses that engaged in money laundering, cheated banks, and absconded from India, but Naresh Goyal lacked that privilege due to a lack of political support. The special PMLA court repeatedly rejected his bail plea on medical grounds, observing that he was under treatment for cancer and other ailments and was receiving better care at the private hospital chosen by him. Goyal had moved the plea on medical grounds last month after the court refused to grant him interim bail considering his ailments.
Goyal’s physical and mental health have deteriorated to such a level that he has many health risks. The Enforcement Directorate objected to Goyal’s plea, stating that since the court had previously rejected his plea of interim bail, the medical reports enclosed with the plea did not suggest any exceptional change in his medical condition. The ED said that Goyal had been allowed to get treatment from the hospital of his choice, but his plea for bail was nothing but an attempt to delay the trial.
