Jet Airways founder Naresh Goyal arrested by ED

Naresh Goyal. File Pic/AFP

The Enforcement Directorate (ED) on Friday arrested Naresh Goyal, the founder of Jet Airways, in connection with the Canara Bank fraud case, which reportedly involves Rs 538 crores, official sources said.

They said, the arrest followed approximately eight hours of interrogation earlier in the day. He will be produced in a court on Saturday.

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In July, the ED had initiated a fresh money laundering case against Naresh Goyal and carried out searches at several locations in Mumbai and elsewhere as part of their investigation under the Prevention of Money Laundering Act (PMLA).

The Jet Airways ceased its operations in April 2019 after a nearly 25-year run. The airline struggled to secure funds for ongoing operations and incurred substantial losses, ultimately leading to its closure.

The central agency's action comes as a response to the continuing investigation by the Central Bureau of Investigation (CBI) into Goyal's activities. In its First Information Report (FIR), the CBI had charged Jet Airways and its founders with causing financial losses to Canara Bank. The bank asserted that a forensic audit of Jet Airways Limited revealed that it allegedly disbursed Rs 1,410.41 crore to "affiliated entities" as part of its overall commission expenses, which effectively diverted funds away from Jet Airways Limited.

In accordance with the provided Jet Airways (India) Ltd (JIL) sample agreement, it was clearly specified that the General Selling Agents (GSA) should be responsible for their own expenses, not Jet Airways Limited. A discrepancy emerged as Jet Airways Limited was allegedly found to have covered various expenses totaling 403.27 crore, which contradicts the GSA arrangement, as stated in the complaint made to the CBI, sources added.