Goyal used proceeds of crime for personal gain: ED chargesheet

MUMBAI: The Enforcement Directorate (ED) on Tuesday filed its chargesheet against Naresh Goyal, founder of Jet Airways, his wife Anita Goyal, and others, as part of its money-laundering investigation into an alleged bank fraud of around ₹538.62 crore.

ED’s probe has revealed that parts of the loan funds borrowed from a consortium of banks, which constituted “proceeds of crime”, were allegedly diverted for personal gains and needs of the accused. The probe also revealed that parts of the funds, which were not used for sanctioned purposes, were used to purchase certain assets abroad, sources said. As part of its probe, ED is trying to reach the end beneficiaries of the proceeds of crime, the sources said. Goyal was arrested in Mumbai on September 1. The 72-year-old, who suffers from various health problems, is currently lodged in Arthur Road jail.

ED’s money-laundering case is based upon an FIR registered by the Central Bureau of Investigation (CBI) in May this year against Jet Airways (India), Goyal, his wife Anita and former company executive Gaurang Ananda Shetty and unknown public servants and private persons in connection with the alleged fraud at Canara Bank.

ED’s probe revealed that Goyal had allegedly created various trusts abroad that are under the agency’s scanner and through them, the accused purchased various immovable properties. The money used by the trusts were allegedly nothing but the proceeds of crime siphoned off from India, agency sources claimed.

The probe had accused Goyal of avoiding furnishing details of all his bank accounts in India and abroad and details of movable and immovable properties in India and abroad. According to the agency, when Goyal was asked about such details, he had allegedly referred the name of one Hasmukh Gardi, a resident of United Arab Emirates, to whom he had given the power of attorney. The agency had summoned Gardi but he is yet to appear before it.

Goyal’s lawyers had however denied ED’s allegations against him and stated that he had co-operated fully in the ED’s probe as well as in the previous CBI probe.

The CBI registered its case based upon a complaint in November 2022 from Canara Bank, Mumbai. The case, registered under sections of the Indian Penal Code and Prevention of Corruption Act, related to the offences of cheating, criminal conspiracy, criminal breach of trust and criminal misconduct against the accused for causing the bank a loss of ₹538.62 crore.

The bank alleged that it had sanctioned credit limits and loans to Jet Airways (India) Ltd (JIL) to the tune of ₹848.86 crore, of which ₹538.62 crore was outstanding. The loan account was declared an alleged fraud in July 2021.

The bank had alleged that the forensic audit conducted in the accounts of the airline revealed alleged fraudulent features like diversion and siphoning of funds. It was also alleged that funds were diverted through Jet Lite (India) Limited. “As per the sample agreement of JIL, it was noted that the expenses of the General Sales Agents (GSA) were to be borne by GSA itself and not by JIL.

However, it was observed allegedly that JIL has paid various expenses amounting to ₹403.27 crore, which is not in tune with the GSA,” the bank’s complaint, which is a part of the CBI FIR, alleged. It also alleged that personal expenses, including the staff salaries and phone bills of the Goyal family, were handled by the firm.

The bank alleged that the accused’s transactions pointed towards cheating, misappropriation of funds by the borrower and siphoning of funds borrowed from the bank towards utilisation for purposes unrelated to the operations of the borrower, to the detriment of the financial health of the entity and/or the lender.

In February, the Bombay high court had quashed a separate money-laundering case lodged by the ED against Goyal and his wife based on a Mumbai police case to probe charges of cheating and forgery on a complaint from Akbar Travels.

In the special court on Tuesday, an application was filed on behalf of Goyal to allow his advocates to collect the ED’s chargesheet on his behalf. The court thereafter contacted Goyal through video- conferencing and he was told about his advocate’s prayer. Goyal submitted that the copies of the prosecution complaint --- chargesheet --- and the documents be handed to his advocate and that he has no objection for the same.

When contacted about ED’s allegations in the chargesheet, a Jet Airway legal representative declined to comment.