Rs 269 crore already paid to Mallya in February: Diageo | business | Hindustan Times
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Rs 269 crore already paid to Mallya in February: Diageo

business Updated: Mar 09, 2016 19:27 IST
Kalyan Subramani
Kalyan Subramani
Hindustan Times

Mallya, under probe for defaulting on loans, was paid Rs 269 crore at the time of signing the agreement in February.(Reuters)

British liquor giant Diageo Plc said on Wednesday it had already paid industrialist Vijay Mallya Rs 269 crore of a RS 515 crore settlement plan on a day the Centre revealed the embattled tycoon had left India despite massive outstanding loans.

A spokesperson of Diageo, the world’s largest spirits maker, said in Mumbai the first tranche was paid to Mallya at the time of signing the agreement in February and that the next round of payments was due in 2017.

The revelation came a day after a consortium of 17 banks moved the Supreme Court to stop Mallya from leaving India, worried the fate of their loans worth thousands of crores given to the now-defunct Kingfisher Airlines headed by the tycoon.

On Monday, the Enforcement Directorate registered a money laundering case against Mallya while a tribunal said he cannot touch the Rs 515 crore.

The ED case was based on a CBI probe into alleged “wilful default” by the high-flying tycoon on a Rs 900-crore loan in conspiracy with IDBI Bank representatives.

The United Spirits’ board last year asked Mallya to resign after an internal investigation spearheaded by Diageo found he diverted funds to other companies under his control, charges that he denies.

Banks owed money by Kingfisher Airlines have demanded “first right” to the Diageo cash, arguing that they were left with unpaid debts worth Rs 7,000 crore when the company collapsed more than three years ago.

The State Bank of India, which leads the consortium of lenders, declared Mallya— once known as “The King of Good Times” for his flashy lifestyle and lavish parties— a wilful defaulter last month. A wilful defaulter is one who has the ability to pay a loan but has not.

On Feb 25, when Diageo and Mallya announced the settlement that also saw his resignation as chairman of United Spirits, the UK-based liquor company had said, “Diageo will pay $40 million of this amount immediately with the balance being payable in equal instalments over five years. Diageo’s payment obligations are subject to Dr Mallya’s ongoing compliance with the terms of today’s agreement.”

The Diageo spokesperson reiterated that ‘immediately’ meant it was already paid.

Read: Vijay Mallya has left India: Govt tells Supreme Court