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AirAsia CEO, Others Booked in India Over Alleged Corruption

AirAsia CEO Tony Fernandes

The Central Bureau of Investigation (CBI) on May 29 named AirAsia Group CEO Tony Fernandes and other airline officials in an FIR for alleged involvement in a criminal conspiracy with the previous government to amend rules in order to get overseas flying rights.

The CBI has filed a case against AirAsia (India), the Malaysia-based AirAsia Berhad, and some top executives for allegedly being a part of the conspiracy where money was paid to middlemen for bribes to public servants. Ramachandran Venkataramanan, the managing trustee at Tata Trusts, has also been named in this FIR along with top AirAsia executive Tharumalingam Kanagalingam, and Bo Lingam, the former deputy group CEO of AirAsia Berhad, the Economic Times reported.

Venkatramanan is also a director at AirAsia India and holds 1.5 per cent stake in the firm. The middlemen who have been named in the FIR are Travel Food owner Sunil Kapoor, aviation consultant Deepak Talwar, director of Singapore-based SNR Trading Rajendra Dubey and Venkataramanan.

The CBI alleged that the conspiracy was hatched only a month before the Lok Sabha elections happened in 2014. The case is based on some internal emails exchanged between top executives of AirAsia and the Tata Group, along with other findings, the report added.

In one of the emails, Venkataramanan is reportedly giving assurances to Kanagalingam, saying, “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,” as per ET.

The case was registered after searches took place at five locations in Delhi NCR, Mumbai and Bengaluru, CBI spokesperson RK Gaur was quoted as saying by PTI.

According to the FIR, Fernandes allegedly wanted the company to fly internationally from the day the flying permit was granted, which was in May 2014. In order to fulfill the criteria for international operations, the company needed to have five years of experience and a fleet of 20 aircraft — as per the 5/20 Rule of the Indian Ministry of Civil Aviation. However, the company has not yet been granted international flying permit since it has only 18 aircraft, the PTI report said.

AirAsia India has refuted the allegations, saying that it had registered a case against its first CEO Mittu Chandilya for similar irregularities. “The company had initiated criminal charges against its ex-CEO and has also commenced civil proceedings in Bengaluru for such irregularities,” said Mandal, director at AirAsia India, said, the Business Standard reported.

The FIR also alleges that Fernandes, who is a Malaysian of Indian origin, and his local Indian partner Tata Sons via their nominee Venkatramanan would lobby with the United Progressive Alliance government, so they could get all approvals. They are also accused of lobbying to get clearance from the Foreign Investment Promotion Board (FIPB)  — an inter-ministerial body in the finance ministry that processes foreign direct investment (FDI) proposals and recommends them for approval to the finance minister. The duo also lobbied for amending or removing the existing 5/20 rule for international operations, the FIR has alleged, the news agency reported.

AirAsia India is a joint venture between Tata Sons and Malaysia-based AirAsia Berhad.