BANK LOANS TO LOW NET WORTH PERSONS: A PUNISHABLE OFFENCE (CONTD.)

The recent development in the Vijay Mallya- bank loan default case has been that the Supreme Court has adjourned the hearing of the plea of the State Bank of India (SBI) – led consortium of 17 Banks against the now-defunct Kingfisher Airlines’ (KFA) owner Vijay Mallya to February, 27, 2017. The extradition request of the Indian Government has not yet been honored by the United Kingdom (UK) but a Delegation from the UK has briefed the officials of India’s Ministry of External Affairs, Ministry of Home Affairs and investigation agencies about the legal procedure and requirements of the UK pertaining to extradition of fugitives.

The Consortium had, earlier in March 2016, approached the Supreme Court for seeking its intervention to restrain Vijay Mallya from flying abroad fearing that the debt recovery proceedings initiated by them against Mallya before the Debt Recovery Tribunal, Bengaluru would be stalled.  The Supreme Court had, earlier in April and October, 2016, directed Vijay Mallya to disclose his assets to the Consortium but the latter contended that the disclosure made by Mallya has been ‘vague’ as he had failed to disclose the severance package of Rs 515 crore that he had received from Diageo PLC, an alcoholic beverage company, as a part of his exit from the United Spirits, a subsidiary of Diageo PLC. The Consortium had also filed an F.I.R. with the Central Bureau of Investigation (CBI) against Vijay Mallya in the loan default case in 2016. The CBI had, thereafter, registered a case against Mallya and upon investigation, had arrested a few officials of KFA and IDBI Bank, for forwarding loan to KFA, a low net worth Company.

According to an interview of Vijay Mallya in England, he has claimed that the Indian Authorities do not have any grounds to extradite him from Britain and that he will be safe under the UK laws.

Daliparthy Harini

Legal Associate

The Indian Lawyer