HC dismisses Naresh Goyal’s plea against arrest by ED in ₹538-crore fraud case

The Bombay high court on Tuesday dismissed a petition filed by the promoter of now-defunct Jet Airways, Naresh Goyal, who had called his arrest by the Enforcement Directorate (ED) in connection with a ₹538-crore bank fraud case illegal and sought his immediate release from jail.

In his habeas corpus petition, Goyal claimed that the grounds of arrest were not furnished to him in writing and that he was illegally detained for more than 24 hours before producing him before the special PMLA (Prevention of Money Laundering Act) court. The remand orders were passed by the special court mechanically, without application of mind, the plea said.

Hence, Goyal sought directions to the ED and jail authorities to release him “from the abjectly unlawful and arbitrary custody and incarceration”.

A division bench of justice Revati Mohite Dere and justice Gauri Godse, however, said the grounds of arrest were indeed furnished to Goyal in writing, and he had acknowledged the same by countersigning it.

Besides, the contention that he was illegally detained beyond 24 hours before producing him before the special court was not raised by him either at the first or second remand, and he did not even challenge any of the remand orders, the bench said.

In this backdrop, the bench said Goyal’s petition was not maintainable and that the 74-year-old was in custody under authorisation of a court of competent jurisdiction. HC, however, clarified that it rejected the petition for being not maintainable and kept the Goyal’s statutory options open.

ED arrested Goyal on September 1 in connection with its money laundering probe into the alleged loan fraud of ₹538 crore at Canara Bank. ED’s case is based on a May 3 FIR registered by the Central Bureau of Investigation against Jet Airways (India) Limited, Goyal, his wife Anita and former company executive Gaurang Ananda Shetty, and unknown public servants and private persons.

According to ED, its investigation found that Jet Airways had taken loans running into several thousand crores from a consortium of 10 banks, led by State Bank of India, to meet its operational expenses and ₹6,000 crore was outstanding. “A forensic audit done on the airlines found that ₹1,152 crore had been diverted in the guise of consultancy and professional fees to related firms and ₹2,547.83 crore had been diverted to a sister concern, Jet Lite Limited, to clear its loan,” ED said.

Goyal’s ED custody ended on September 14 when he was remanded in judicial custody. The next day, he approached the high court.