AirAsia PMLA case: ED collects FDI clearance documents

Widening its probe into the AirAsia money laundering case, the Enforcement Directorate (ED) has collected documents from the Commerce and Industry Ministry relatedto FDI clearances given to the airline.

A senior official told PTI that a team of ED investigators picked up a number of documents last week from the Department of Industrial Policy and Promotion (DIPP) as part of this investigation. The DIPP is an arm of the Commerce and Industry Ministry and it deals with rules and norms pertaining to foreign direct investment (FDI). Files collected by the agency pertained to the FDI proposal made by the airline and clearances granted by the FIPB (abolished later) to AirAsia so that it can launch its operations in India, the official said.

FIPB wa s an inter-ministerial body that included officials from different departments including DIPP. They said a special team of the agency working on the case will now go into the policy that existed and the circumstances under which AirAsia was granted approvals. Some other documents on the Foreign Investment Promotion Board (FIPB) clearances will soon be obtained from the Finance ministry.
The ED, last month, had registered a criminal case of money-laundering against AirAsia officials and others for allegedly trying to manipulate government policies through corrupt means to get international licence for its Indian venture AirAsia India Limited.

The central probe agency had pressed sections of the Prevention of Money Laundering Act (PMLA) to probe if alleged tainted funds were used to create illegal assets and it has taken cognisance of the CBI FIR to lodge its own case. The accused in its FIR, known as the Enforcement Case Information Report (ECIR), are same as those in the complaint of the CBI. The agency, they said, will go into the money trail of the accused and the entire deal and a joint probe by the CBI and ED is expected to henceforth go forward in the case. The agency's office in Mumbai has been probing a separate case against the airline and its executives under the Foreign Exchange Management Act (FEMA).

This probe in the case, registered last year, was initiated on the basis of the claims of ousted Tata Group chairman Cyrus Mistry's allegation that fraudulent transactions of Rs 22 crore, involving non-existent entities in India and Singapore, were carried out in an instance involving the airline. The CBI, in its criminal FIR, had booked Group CEO of AirAsia Tony Fernandes, Tharumalingam Kanagalingam also known as Bo Lingam, former Deputy Group CEO of Malaysia-based AirAsia Berhad, and R Venkataramanan, Director AirAsia India Ltd, Bengaluru, besides companies AirAsia India Pvt Ltd and AirAsia Berhad.

The allegation pertains to AirAsia officials and others allegedly trying to manipulate government policies through corrupt means to get international licence for its Indian venture AirAsia India Limited. The CBI case has been registered under 120-B (criminal conspiracy) of the IPC and sections 13(2) read with 13 (1) (d) of the Prevention of Corruption Act. It had alleged that Venkataramanan was lobbying in the government to secure mandatory approvals, some of them through non-transparent means, including the then FIPB clearance, no objection certificate and the attempt for removal or modification of 5/20 rule.

It is alleged that to be eligible for international operations, the company was required to have five years of experience and fleet of 20 aircraft as per 5/20 rule.The company is yet to get international flying permit as it currently has only 18 aircraft, they had said. Fernandes wanted it to fly internationally from the day of getting flying permit granted in May, 2014, it alleged. He and his local Indian partner Tata Sons through their nominee Venkatramanan would lobby in government to get all approvals including FIPB clearance and amend or removal of existing 5/20 rule for international operations, the CBI FIR had alleged.

The CBI has also named Rajender Dubey, Director of Singapore-based HNR Trading pvt Ltd, Sunil Kapur, Chairman Total Food Services, Mumbai and Deepak Talwar, Principal and Founder DTA consulting, New Delhi and the company HNR Trading as alleged lobbyists who used their influence to get 5/20 rule relaxed before General Elections of 2014. AirAsia had denied any wrongdoing after the CBI filed the case and carried out raids at multiple premises. It is alleged that AirAsia India Ltd -- a joint venture between Tata sons and Malaysian company AirAsia Berhad -- was indirectly controlled and operated by the Malaysia group and particularly AirAsia, Berhad violating various existing norms of erstwhile FIPB, now defunct.