The Supreme Court will hear on Wednesday a plea by the consortium of banks led by the State Bank of India seeking to restrain beleaguered liquor baron Vijay Mallya from leaving the country.
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Attorney General Mukul Rohatgi, appearing for PSU banks, mentioned the matter for urgent hearing. The SBI has also approached the Karnataka High Court appealing that Mallya be arrested and his passport impounded.
The plea has come in the background of Mallya’s resignation from the chairmanship of United Spirits last week.
Banks owed money by Mr Mallya’s now defunct Kingfisher Airlines had demanded “first right” to the Diageo cash, arguing they had been left with hefty unpaid debts – $1.4bn as of September 2013 – when the airline collapsed more than three years ago.
A Debt Recovery Tribunal restrained him from accessing the Rs 515 crore that he received from the sale of the spirits business to Diageo Plc while the Enforcement Directorate (ED) filed a money laundering case against the flamboyant businessman. “Amount as sought by the applicant banks stands attached”, the order said.
The tribunal barred Diageo plc from paying Rs.5.04 billion ($75 million) as a severance package to Mallya who quit the chairmanship of its Indian company, United Spirits Ltd. last month, till the pending case against the liquor baron before it is decided. The Enforcement Directorate also registered a money laundering case over a loan default with IDBI.
The ED has registered charges under various sections of the PMLA against Mallya and others named in the CBI complaint.
The CBI had booked Mallya, director of Kingfisher Airlines, A Raghunathan, chief financial officer of the airlines, and unknown officials of IDBI Bank in its FIR, alleging that the loan was sanctioned in violation of norms regarding credit limits.
He also said the dues run into thousands of crores.
In addition, ED sleuths will also be scrutinising transactions involving other companies owned by Mallya across the world.
The tribunal’s choice is dependant on a from the State Bank of SBI or India, that will be owed Rs-1,600 crore by Kingfisher.
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In a statement late Sunday Mallya said he was “making efforts to reach a one-time settlement with the banks” according to local media reports.
