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Bribes, mails & a secret govt note: How AirAsia landed in trouble
Wednesday, May 30, 2018 IST
Bribes, mails & a secret govt note: How AirAsia landed in trouble

NEW DELHI: The Central Bureau of Investigation (CBI) filed a case on Tuesday against AirAsia (India), AirAsia Berhad, and its top executives, including group chief executive officer (CEO) Tony Fernandes, for allegedly entering into a criminal conspiracy with the UPA government to change rules to get overseas flying rights.

 
 

The conspiracy, it’s alleged, was hatched just a month before the 2014 Lok Sabha Elections. The case is based, among other findings, on a clutch of internal emails between senior executives of AirAsia and the Tata Group.
 
One such email with the CBI is that of top Tata Trusts executive Venkataramanan Ramachandran, who is named in the FIR, allegedly giving personal assurances from then civil aviation minister Ajit Singh. It also conveys an assurance from the head of the Foreign Investment Promotion Board (FIPB) to go ahead with investment plans even when they were challenged in court as early as October 2013.
 
“Met Mr Ajit Singh a short while ago. He said approvals should come soon and that our planning should be on the basis of the 5/20 rule getting scrapped,” reads the email by Venkat to top AirAsia executive Tharumalingam Kanagalingam, who is also named in the CBI FIR.
 
Venkat did not respond to emails and calls by ET.
 
AirAsia strongly denied the charges.
 
“AirAsia India Limited (AAIL) refutes any wrongdoing and is cooperating with all regulators and agencies to present the correct facts. In November 2016, AAIL had initiated criminal charges against its ex-CEO and had also commenced civil proceedings in Bengaluru for such irregularities. We hope to bring early resolution to all such issues,” said Shuva Mandal, director, AirAsia India Ltd.
 
 
Bribes Paid for Securing Permit: FIR
 
Venkat’s email, which was accessed by ET, further states: “Met the chairman of FIPB today. He said they are going to strongly defend the policy in the courts next week and they have filed affidavits to that effect. The same is repeated by the ministry of commerce today.”
 
Venkat is the managing trustee of the Sir Dorabji Tata Trust and is responsible for management and oversight of all the Tata Trusts. Tata Sons and AirAsia Berhad own 49% each in AAIL while Venkat and former TCS CEO S Ramadorai hold 1.5% and 0.5%, respectively, in the airline.
 
In its FIR, the CBI has alleged that bribes were paid for securing a permit for international operations by removing or amending the 5/20 rule – which restricted any airline with less than 5 years of experience and 20 aircraft from flying overseas.
 

 
 

A total of nine individuals, including corporate lobbyist Deepak Talwar, have been booked by the CBI along with unknown government officials serving during the UPA-II regime, officials of the civil aviation ministry and others. Public servants of the now-disbanded foreign investment promotion board (FIPB) have also been booked on charges of corruption and criminal conspiracy.
 
Apart from CEO Fernandes, directors of AirAsia Group, Malaysia, have also been named. 
According to the agency, “a secret Cabinet note was sent on February 27, 2014 to the Cabinet to amend/remove the existing 5/20 rule for operation of international schedule in civil aviation. Further, the civil aviation ministry had sent clarification in the form of supplementary note on March 5, 2014 to the Cabinet”.
 
The proposal at that time, however, could not be approved since the Election Commission had announced Lok Sabha General Elections on March 5, 2014, reads the agency’s FIR.
 
The FIR states that private individuals Deepak Talwar and Sunil Kapur “acted as lobbying agents”.
 
Indicating that these lobbying attempts extended until 2016, the FIR states: “During 2015-16, AirAsia remitted about Rs 12.28 crore to M/s HNR Trading Ltd, Singapore (co-accused) for a sham contract on the basis of a bogus agreement on plain papers, which was utilised for paying bribe to unknown public servants of Indian government and others for securing permit for operation of international scheduled air transport services.”
 
Talwar, already wanted in criminal cases by probe agencies, is said to have made a presentation on a strategy to target government officials for which he was apparently paid Rs 17 lakh, the FIR mentions.
 
The purpose, according to CBI, was to fulfill Fernandes’ aim to have “the airline venture to be able to fly internationally from day one”.
 
To facilitate this, Rajender Dubey played a role of a liaison agent and was instrumental in seeking appointments and facilitating meetings for officials of AAIL with various Indian government officials for clearance of formalities, the FIR says.
 
It added that Fernandes and Kanagalingam “intentionally chose to beat the legal framework and policies of the aviation sector”.
 
The CBI has alleged that Fernandes employed Sunil Kapur, owner of M/s Travel/Total Food Services as a “lobbying agent” by awarding an on-board catering contract “as a quid pro quo without any negotiation”.
 
Elaborating on the FIPB violations, the FIR states that AirAsia Group of Malaysia was indirectly allowed day-to-day control over M/s AirAsia (India) Ltd through a “brand licence agreement”, which was a violation of the then guidelines of FIPB as only 49% FDI was allowed in aviation sector.
 
Searches were carried out by the agency at six locations including Delhi, Mumbai, Gurgaon and Bengaluru.
 

 
 
 
 
 

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Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST
Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST
Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST
Shibu Chandran
2 hours ago

Serving political interests in another person's illness is the lowest form of human value. A 70+ y old lady has cancer.

November 28, 2016 05:00 IST


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