The Bombay High Court on Wednesday directed the Enforcement Directorate (ED) to file its affidavit in response to Jet Airways founder Naresh Goyal's plea challenging his "illegal" arrest in a money laundering case linked to bank loan default.

Goyal, in his plea, claimed his arrest was illegal as it was done without following provisions of the Prevention of Money Laundering Act (PMLA) and also challenged orders of a special court which had sent him to the ED custody first and thereafter to jail under judicial remand.

When the plea was taken up for hearing on Wednesday by the HC, advocate Hiten Venegaonkar, appearing for the central agency, sought time to file their reply affidavit.

Senior counsel Amit Desai, appearing for the 74-year-old businessman, urged the court to grant a short date for hearing and pointed to his client's advanced age.

A division bench of Justices Revati Mohite Dere and Gauri Godse then said it has to give the other side time to respond.

"He (Goyal) can file for bail. That liberty is there... ED may challenge this plea (filed by Goyal in HC) on maintainability itself," Justice Dere noted.

The bench posted the matter for hearing on October 6 by when the financial crime-fighting agency has to file it affidavit.

Goyal is currently in judicial custody and lodged at Arthur Road Jail in Mumbai after arrest in the money laundering case linked to an alleged fraud of Rs 538 crore at Canara Bank.

The septuagenarian businessman, who once operated India's top private airline, was arrested by the ED on September 1 and produced before a special court which remanded him to custody of the central agency till September 14.

On September 14, he was remanded to judicial custody for two weeks.

Goyal, in the plea, said his arrest was arbitrary, unwarranted and done without the ED following proper procedure. He sought to be released immediately.

The money laundering case stems from an FIR of the Central Bureau of Investigation (CBI) against Jet Airways, Goyal, his wife Anita and some former company executives of the now grounded airline in connection with the alleged Rs 538-crore fraud at Canara Bank, a government lender.

The FIR was registered on the bank's complaint which alleged that it sanctioned credit limits and loans to Jet Airways (India) Ltd to the tune of Rs 848.86 crore of which Rs 538.62 crore was outstanding.

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