Jet Airways Founder Naresh Goyal Questioned In Alleged Foreign Funding Violation Case

In March, Naresh Goyal and his wife resigned from Jet Airways's board, while he also resigned as chairman

Naresh Goyal, founder of the now-grounded Jet Airways, was today questioned for eight hours by the Enforcement Directorate in Mumbai in connection with alleged foreign direct investment violations when Etihad Airways acquired stakes in Jet Privilege Private Limited in 2014. Last month, ED officials raided 12 properties in Mumbai and Delhi that are owned by Mr Goyal, reportedly uncovering links between him and foreign bank accounts with large amounts of money in them.

A preliminary inquiry launched earlier this year by the Enforcement Directorate alleged that provisions of the Foreign Exchange Management Act (FEMA) were violated when Abu Dhabi's Etihad Airways invested $150 million for a 50.1 per cent stake in Jet, a loyalty and rewards management company formed in 2012 as a subsidiary of Jet Airways.

Naresh Goyal's role in the deal is believed to be the main focus of the ED investigation.

"Unlike other issues, in cases relating to FEMA violation, ED has original jurisdiction and can initiate a probe by ourselves and need not be relying on other agencies' FIRs," an ED official told NDTV in May.

In May, Mr Goyal and his wife were stopped from travelling to London by immigration officials at Mumbai airport. A lookout circular had been issued against the two of them.

In March, Mr Goyal and his wife resigned from the board of Jet Airways. He also resigned as the airline's chairman.

Weighed down by debts of Rs 8,000 crore, Mr Goyal's Jet Airways stopped operations indefinitely earlier this year, leaving thousands of employees without a job overnight.

Until recently, the airline was the second largest carrier in India by market share. Operations were stopped after the State Bank of India-led consortium of lenders turned down a request for emergency funds.

Mr Goyal is also being investigated by the Serious Fraud Investigation Office (SFIO), which functions under the Ministry of Corporate Affairs, in connection with allegations that the promoters of Jet Airways were siphoning funds from the airline.

With inputs from IANS