Jet Airways has been under the scanner for alleged violation of foreign exchange regulations over a 2014 deal with Etihad for its Jet Privilege program.

Offices of Jet Airways residence of founder Naresh Goyal searched by ED
Money Jet Crisis Friday, August 23, 2019 - 16:57

The Enforcement Directorate (ED) on Friday carried out searches at over a dozen locations in Delhi and Mumbai pertaining to Jet Airways, including at the residence of founder Naresh Goyal.

A senior ED official told IANS that "searches are on at over a dozen locations in Delhi and Mumbai."

He said the residence of Jet Airways founder Goyal is also bring searched.

An ED official said the searches are being conducted under the provisions of the Foreign Exchange Management Act (FEMA), and are aimed at gathering additional evidence of the alleged irregularities committed by the grounded airline, including diversion of funds.

This comes after the Ministry of Corporate Affairs (MCA) inspected to find large-scale irregularities at Jet Airways such as diversion of funds. Following this the government ordered a probe by the Serious Fraud Investigation Office (SFIO).

It has been under the lens for alleged violation of foreign exchange regulations when it signed a deal with Etihad in 2014. The deal, worth $150 million, saw Etihad picking up a 50.1% stake in its frequent flyer programme.

The Registrar of Companies flagged certain discrepancies in the books and instances of violation of the Companies Act.

A travel ban was also imposed on Goyal after he and his wife were stopped from leaving the country.

Jet Airways which suspended operations on April 17 is currently undergoing bankruptcy proceedings under the IBC Act. Naresh Goyal, who founded and ran the airline for nearly 25 years, stepped down as its Chairman before it shut shop.

Currently, the airline is in the process of finding bidders to be able to bring it back in the air.

 

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