Comments
The Central Bureau of Investigation (CBI) Friday carried out searches at premises of Jet Airways, its founder Naresh Jagdishrai Goyal and five other places in Mumbai after registering an FIR to probe Canara Bank being defrauded of ₹538 crores by the airlines grounded in 2019.
The CBI has booked Goyal, his wife Anita, and former airline director Gaurang Ananda Shetty a complaint recieved on November 23, 2022, from Canara Bank, Recovery & Legal Section, Circle Office, BKC, Mumbai.
The bank requested the CBI to investigate offences of cheating, criminal conspiracy, criminal breach of trust and criminal misconduct committed by JIL, Goyal, Anita and Shetty.
Forensic examination
Forensic examination of Jet Airways India Ltd (JIL) audit, done from April 2011 to June 2019, revealed that the accused with alleged dishonest intention diverted and shiphoned off bank’s fund which were meant for operations of the airlines promoted by Tail Winds Ltd, an overseas corporate body registered at Isle of Mann.
The airlines got funds of ₹848.86 crores in the form including of working capital, term loan and inland letter of credit but ₹538.62 crore was book liability as on June 5, 2019, when its account was declared (NPA) and flagged as fraud by the bank. The matter is also under NCLT.
For instance, said the CBI FIR, the Jet Airways got term loan of ₹ 400 crore to meet operating expenses, general corporate purpose to support its plan to turn the company like for aircraft reconfiguration, introduction of new routes and business promotion.
Since August 2018, the company claimed it was facing liquidity and operational issues and came under financial stress resulting in outstanding debt, said the bank’s complaint to the CBI.
The forensic audit revealed that personal expenses such as for salaries of staff, phone and vehicle maintenance of Goyal family was also done through Jet Airways India Ltd.
As per the JIL agreement, expenses of general selling agents (GSAs) were to be borne by GSA themselves but the company paid Rs 403.27 crores to them.
Interestingly, the company siphoned off funds through transfer to subsidiary Jet Lite India Ltd in the forms of loans and advances and investments from 2011 to 2018 and later wrote it off, alleged the CBI. According to financial records, ₹14,552.44 crore was given as loan to Jet Lite and in return ₹13529.62 crore was recieved from it. “Provisons were created for the loans given to JLL for year on year basis where the closing balance of loan amount was ₹1,282.39 crore in FY 2011-12 and by FY 2019-20 it was ₹2,547.83 crores which includes the principal amount along with interest charged by the JIL to JLL,” said the CBI.
Diversion of funds
It also diverted funds in the name of payments made for professional and consultancy purposes.
The company is dealing with Canara Bank since 2005 and all the exposure are under the SBI led consortium arrangement. Goyal took over the control in 1997 for bidding in passenger airlines and Jet Airways took to wings in December of 2004 with him retaining 51 per cent ownership.
Comments
Comments
Comments have to be in English, and in full sentences. They cannot be abusive or personal. Please abide by our community guidelines for posting your comments.
We have migrated to a new commenting platform. If you are already a registered user of TheHindu Businessline and logged in, you may continue to engage with our articles. If you do not have an account please register and login to post comments. Users can access their older comments by logging into their accounts on Vuukle.