CVC seeks report from aviation ministry on Jet-Etihad deal

BJP MP Nishikant Dubey had written to CVC alleging fraud in the Jet-Etihad deal leading to a revenue loss of Rs.500 cr
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First Published: Thu, Jul 18 2013. 07 26 PM IST
On 13 June, the foreign investment promotion board deferred a decision on the deal, saying it required more clarity on control and ownership structure of Jet Airways. Photo: Ramesh Pathania/Mint
On 13 June, the foreign investment promotion board deferred a decision on the deal, saying it required more clarity on control and ownership structure of Jet Airways. Photo: Ramesh Pathania/Mint
New Delhi: The Central Vigilance Commission (CVC) has sought a “factual report” from the ministry of civil aviation on a complaint of alleged corruption in the Rs.2,058 crore deal between Jet Airways (India) Ltd and Abu Dhabi’s Etihad Airways PJSC.
The move came after Bharatiya Janata Party (BJP) MP Nishikant Dubey wrote to CVC last month alleging serious fraud to cheat the Union government and cause a huge revenue loss of Rs.500 crore to the national exchequer by Jet Airways in collusion with senior civil aviation ministry officials.
The letter (of Dubey’s complaint) has been sent to the chief vigilance officer of the civil aviation ministry to furnish a factual report to the Commission, officials familiar with the matter said. The multi-crore agreement between the two aviation firms has been mired in controversy ever since it became public.
Etihad had on 24 April announced its decision to purchase 24% stake in Jet for Rs.2,058 crore. On 13 June, the foreign investment promotion board (FIPB) deferred a decision on the deal, saying it required more clarity on control and ownership structure of Jet Airways. Jet chairman Naresh Goyal owns a 51% stake in the airline. Besides FIPB, capital market regulator Securities and Exchange Board of India (Sebi), fair trade watchdog Competition Commission of India and Department of Industrial Policy and Promotion have also raised certain queries. The deal is the largest foreign investment proposal in the aviation sector.
Dubey, who is a Lok Sabha member from Jharkhand, had early this month also written to Prime Minister Manmohan Singh, with copies to the Central Bureau of Investigation, CVC and cabinet secretary Ajit Seth, alleging “strategic conspiracy” by some elements to get the deal approved. The revenue department is also looking into the proposed deal to identify the beneficial owners and check whether or not it is structured in a way to evade taxes, sources added.
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First Published: Thu, Jul 18 2013. 07 26 PM IST
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