ED arrests Jet Airways founder Naresh Goyal in bank fraud case

He will be produced before the special PMLA court Saturday.

In July,  the ED had also searched eight locations in Mumbai and Delhi in connection with the case.

The case against Goyal is based on a May 3 case filed by the CBI in connection with the alleged loan fraud case involving Canara Bank.

The Jet Airways (India) Ltd had dealings with Canara Bank since 2005, and all exposures to the company were under a State Bank of India-led consortium arrangement.

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 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 alleged diversion and siphoning of funds were related to commission expenses and personal expenses such as salaries of staff, phone expenses, vehicle expenses of the Goyal family paid by Jet Airways (India) Ltd.

The forensic audit also revealed siphoning of funds through Jet Lite (India) Ltd via advance and investing and subsequently writing it off by making provisions. The company allegedly diverted funds for making transfers to the subsidiary Jet Lite (India) Ltd in the form of loans and advances and investments extended to the company.

“All the transactions point towards cheating and misappropriation of funds by the borrower and siphoning of funds borrowed from banks being utilised for purposes unrelated to the operations of borrower…,” the CBI stated in the FIR.