Mumbai: Naresh Goyal, the founder of Jet Airways, told the investigators of Enforcement Directorate (ED) that he does not have any personal income and is being maintained by his wife Anita Goyal, who too is an accused in the money laundering case against the family.
Money Laundering Allegations
The Enforcement Directorate had on Tuesday submitted a prosecution complaint against Naresh Goyal and his wife Anita Goyal alleging money laundering to the tune of Rs 5716.34 crores. The agency has made four companies namely M/s Jet Airways (India) limited (JIL), M/s Jetair Pvt. ltd , M/s Jet Enterprises Pvt Ltd (JEPL) and Jet Airways LLC Dubai, as an accused. The special PMLA judge MG Deshpande took cognisance of the complaint holding there is a prima facie evidence of money laundering against Goyal.
Naresh was arrested on September 1, by the Enforcement Directorate. However, in his statement given on July 19, Goyal told the investigators that he doesn't have any personal income and that his wife takes care of his all expenses. Goyal in his subsequent statement recorded after his arrest had claimed that he had not taken any salary from JIL, JLl or any other group company/subsidiary of the Jet Airways in any role and he was not authorized signatory for any banking or financial transaction.
Goyal had stated that he has been non resident Indian since 1991, and since the inception of the Jet Airways in the year 1993, he has been the non executive chairman and non executive director of JIL. He claimed that he used to attend meetings with other airlines for improving relations between Jet Airways and various other airlines.
Goyal claimed that initially his wife was executive vice president but since 2015, she became non executive VP but remained part of board of directors. The agency however claimed that Goyal was the decision maker in Airlines and without his approval nothing moved. The ED claimed Goyal micro managed all decision making at JIL.
Lavish Lifestyle and Payments
The agency claimed that the family had a lavish lifestyle and recieved obnoxious amount of funds from JIL indirectly without contributing anything to JIL. The agency claimed that Goyal's family members - his wife, son and daighter were paid huge remunerations by the Airlines. The agency pointed out that after when she became non executive VP, she was appointed as consult to CEO of the airlines and was paid Rs 1.15 crores per year. This was increased to 2.40 crores in March 2016. The agency claimed that Anita in total received Rs 12.20 crores as consultancy fees from 2015 to 2023.
Besides, his son Nivan and daughter Namrata were also employed by JIL based on the recommendation of Goyal for a yearly salary of Rs 25 lakhs each. Nivan worked in revenue management and Namrata used to work in the cabin crew department. Besides, the agency further stated, "Naresh Goyal being the 100% shareholder of Tailwinds the holding company of JIL, was getting dividends worth Rs 160.58 crores since 1995-96 to 2006-07 which was declared by JIL from time to time."
Dividends and Property Acquisition
The agency claimed that once the company went public by diluting shares of promoters from 100% to 80% aggregating to Rs 18993 million, the entire public money was used by promoters that is Naresh Goyal to acquire immovable properties in foreign jurisdiction including London. It is also alleged that the company did not declare dividend after becoming public even when company was in profits between 2015 to 2018, rather started taking huge loans for financing its operations and acquisitions, ED claimed.
The forensic audit of JIL, revealed that the funds were diverted and siphoned off in three ways - payment of professional and consultancy expenses, commission paid to General Selling Agents (GSA), and through Jet Lite (India) ltd (JLL).
"The GSA commission paid by JIL were ultimately used by members of Goyal family in incurring their personal expenses and siphoning of funds by executing different bogus consultancy contracts only to be used in acquiring immovable properties and luxury cars," the ED claimed.
Vinay Garodiya, partner of Ernst and Young, which was appointed by the State Bank of India for forensic audit in 2020, said, while the audit several parties to whom huge consultancy charges were paid were red flagged.
The JIL had paid Pathak HD and associates (PHDA) a tune of Rs 279.81 crores in form of other allowances. The auditor claimed that when the scrutinized the accounts they found that the total amount of salaries that JIL directed PHDA to disburse was less than that of the actual amount disbursed.
Also Garodiya said they had raised suspicion over payment to SA Sangani and Associates to the tune of Rs 40 crores for expenses pertaining to higher management salaries. However, it was noticed that the nature of business of the firm was tp carry on the business of manufacturing trade and deal in botanicL products, mosquito coils, repellents, chemicals, pharmaceutical products.
Besides, it was noticed that NOVO Corporate Advisors Private Limited was paid Rs 3.15 crores towards GST advice from time to time from the year 2016 to 2018. The auditor raised red flag for this as the GST law came into existence from July 2017 and also revenue of the firm for the year 2015-16 and 2017-18 was nill.
Commission Payments to GSAs
The ED raised question on teb payment of commission to several GSA and said that even when the concept of GSA was discontinued by many airlines like Air India since, 2009, "this was deliberately kept on by Goyal to serve his ultirior motive of siphoning of money."
The agency said, as per the forensic audit, commissioned by ED, conducted on the account of JIL, it was noticed that direct payment/commission to various GSAs have been identified to the extent of Rs 2365.25 crores. The agency claimed that JIL paid Rs 1141 crores to JPIL, Jet Airways LLC, Dubai, Jet Airways of India INC, USA, and Jetair (UK) Limited. This the agency claimed "Goyal has deliberately siphoned off revenues from JIL for his personal benefits by making inflated payments to the related entities when it was not discharging any duties of GSA." Besides the agency claimed that the commission paid to these group are not disclosed seperately in the financial statements in spite of these entities are those on which JIL promoters have significant control.
Besides, ED is still probing the money trail in connection with loan granted by JIL to JLL worth Rs 4057.45 crores.