NEW DELHI: The Enforcement Directorate (ED) has issued summons to Pakistan International Airlines (PIA) because the national carrier of the neighbouring country has acquired five offices on Barakhamba Road without obtaining required clearances from the Reserve Bank of India (RBI).
The PIA’s local office-in-charge in the national Capital has been issued summons for appearance and submission of documents after the probe agency found that it has acquired/purchased some immovable official premises in alleged contravention of the Foreign Exchange Management Act (Fema), and as stipulated by the RBI.
ED officials confirmed that PTI that PIA has been issued summons and senior executives of the airline have been asked to depose before the agency on January 13.
The purchase of these flats for ‘office use’ is in violation of the Foreign Exchange Management Act (Fema), the official said.
Officials said that Fema stipulates that no person being a citizen of Pakistan, Bangladesh, Sri Lanka, Afghanistan, Iran, China, Nepal or Bhutan without prior permission of the RBI shall acquire or transfer immovable property in India. They are only allowed to lease property that too for a period not exceeding five years.
The PIA has allegedly been found contravening this clause and hence ED has issued summons to it for scrutiny of official documents and records after which the agency will decide to initiate penal action which can either be levy of financial penalty or cancellation of the purchase deal.
A senior intelligence official said, “It is indeed strange that a loss-making airline like PIA should be picking up such exorbitantly priced real estate near the Connaught Place area.”
The official cited reports in Pakistan press as saying that “the financial position of national flag carrier Pakistan International Airlines (PIA) remains precarious as it continues to suffer an annual loss of billions of rupees despite hiring aircraft on lease to improve efficiency and service”. “Given the fact that it is facing a financial crunch to run its operations, it does not make any business sense to buy these flats. There is every danger that these flats could be misused for some other activities,” the official added.
In June 2013, when the Pakistan Muslim League (Nawaz) government came to power, PIA losses exceeded those recorded in previous years standing at Rs 4,453.1 crore.
For six months of the current calendar year, the losses were Rs 1,013.1 crore. According to a report submitted to Pakistan’s Economic Coordination Committee in its meeting on October 30, 2014, from 2011 to June 2014, PIA suffered a loss of Rs 20,769 crore.
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