ED registers case, to probe ₹22 cr AirAsia transactions
Enforcement Directorate on Wednesday registered a case under the Foreign Exchange Management Act to probe alleged fraudulent transactions of ₹22 crore involving AirAsia, an aviation joint venture of Tata Group.
The ED has issued summons to Air Asia officials.
A preliminary investigation was conducted after ousted Tata group chairman Cyrus Mistry questioned the legality of payments to non-existent parties in Singapore and India. Mistry made these allegations in a letter to board members and trustees. He was expelled on October 24.
Mistry had claimed a recent forensic investigation unearthed the fraudulent transactions.
Bharatiya Janata Party MP Subramanian Swamy also wrote to ED chief Karnail Singh in November, seeking a probe into Mistry’s allegations.
Swamy said the ₹22 crore payment to Air Asia (Bhd) of Malaysia needed to be probed under the Prevention of Money Laundering Act.
Swamy alleged it was a bribe routed through hawala to set up the illegal Air Asia (India) aviation company.
During the bitter war between Mistry and Tata group’s interim chairman Ratan Tata, the former had alleged that due to the latter’s passion for aviation, the Tata Sons board increased capital infusion into the aviation sector at multiple levels of the initial commitment.
In a letter written to the board members of Tata Sons a day after he was ousted on October 24, Mistry said, “Board members and trustees are also aware that in the case of Air Asia, ethical concerns have been raised with respect to certain transactions as well as overall prevailing culture within the organisation.”
Mistry went on to allege that “executive trustee Mr Venkataraman, who is on the board of Air Asia and also a shareholder in the company, considered these transactions as non-material and did not encourage further study”.
It was only at the insistence of the independent directors, one of whom immediately submitted his resignation, that the board decided to belatedly file an FIR, Mistry said in the letter.
He claimed it was Tata who had completed negotiations with Air Asia, but early in his tenure as the chairman of Tata Sons, he (Mistry) was asked to table a proposal for the JV with Air Asia at a Tata Sons board meeting.
In 2013, Tata Sons joined hands with Malaysian carrier AirAsia and Arun Bhatia’s Telestra Tradeplace to start low-cost carrier AirAsia India.
WITH PTI INPUTS
CYRUS MISTRY ALLEGED THAT PAYMENTS WERE MADE TO NONEXISTENT PARTIES IN SINGAPORE AND INDIA