Bombay High Court Quashes Bank of India's 'Fraud' Tag On Naresh Goyal's Account
Goyal, who was arrested by the Enforcement Directorate in September 2023, faces allegations of laundering and siphoning loans worth Rs 538.62 crore extended to Jet Airways by Canara Bank.
The Bombay High Court has set aside Bank of India's move to classify Jet Airways founder Naresh Goyal's account as "fraud," as per news agency ANI. The ruling by Justice RI Chagla also struck down all subsequent actions arising from the classification, including the bank's reporting of Goyal's account as fraudulent to central agencies.
Goyal, who was arrested by the Enforcement Directorate in September 2023, faces allegations of laundering and siphoning loans worth Rs 538.62 crore extended to Jet Airways by Canara Bank. Goyal used the majority of the loan given to airlines—Rs 538 crore out of Rs 849 crore—for his personal expenses, according to the complaint. The loan was later declared non-performing in 2019.
Goyal was serving judicial custody at Arthur Road Jail. He was granted interim bail by the High Court on May 6, 2024, after spending 249 days in custody, with the court citing his wife's cancer treatment as grounds for relief.
However, Goyal's wife passed away on May 16, 2024. His counsel, senior advocates Aabad Ponda and Ameet Naik, later argued that the Jet Airways founder himself was due to begin cancer treatment and required continued bail extensions for medical procedures.
The high court eventually made his bail absolute in November 2024, while imposing restrictions on his travel and directing him to remain in Mumbai. Goyal's plea also noted that his passport remains with the ED and that his medical condition makes him a minimal flight risk.
The Supreme Court had also ordered Jet Airways to enter liquidation, directing the Mumbai bench of the National Company Law Tribunal to appoint a liquidator.
The court criticised the Jalan-Kalrock Consortium for failing to implement the airline's resolution plan, noting that adjustments of a Rs 150 crore performance bank guarantee by the National Company Law Appellate Tribunal violated the plan and the court’s previous orders.
Stressing the importance of adhering to the Insolvency and Bankruptcy Code’s timelines, the Supreme Court stated the resolution plan is "incapable of being implemented."
