SC to hear plea to stop Vijay Mallya from leaving India today
The Supreme Court will hear on Wednesday a plea by the consortium of 13 banks led by the State Bank of India seeking to restrain beleaguered liquor baron Vijay Mallya from leaving the country.business Updated: Mar 09, 2016 08:43 IST
The Supreme Court will hear on Wednesday a plea by the consortium of 13 banks led by the State Bank of India seeking to restrain beleaguered liquor baron Vijay Mallya from leaving the country.
A bench of Chief Justice TS Thakur and Justice Uday Umesh Lalit agreed to hear the plea as Attorney General Mukul Rohatgi mentioned, for an early hearing, the plea challenging Karnataka High Court’s March 4 refusal to pass an interim order restraining Mallya from leaving the country and impounding his passport.
The high court instead of passing an interim order restraining Mallya from leaving the country had asked him, Diageo Holding Netherlands B.V., Diageo Holdings and United Spirits Ltd to file their objections to the banks’ plea, the banks said in their plea before the apex court.
Seeking the freezing of Mallya’s passport, the banks have also sought direction to Bengaluru based Debt Recovery Tribunal (DRT) to “expeditiously dispose of” their plea for the recovery of Rs.6,203 crores from Mallya.
Describing the high court order declining to restrain Mallya from leaving the country as “miscarriage of justice”, they contended that the high court by its “impugned order has completely failed to protect” their interest as they have “yet to recover an amount in excess of Rs.9,000 crore” from Mallya, Kingfisher Airlines, United Breweries (Holding) Limited and Kingfisher Finvest (India) Ltd.
They argued that the high court should have appreciated that Mallya, Kingfisher Airlines and United Breweries (Holding) Ltd., “have been declared as wilful defaulters and that they are currently liable to pay Rs.9,091 crore” to them and “non-payment of the same may adversely impact the economy of the nation”.
The petition said that restraining Mallya from leaving the country was necessary to ensure his presence before the debt recovery tribunal where banks have moved for the recovery of Rs.6,203 crore.
The banks have said that the high court ought to have appreciated that the plea for an interim order seeking the impounding Mallya’s passport “was very urgent” as if he was to “succeed in moving away from India and settling in London” then the purpose of the entire exercise would be defeated.
“By way of Master Debt Recast Agreement and other related financing documents, the existing loans were restructured and treated as a single facility” on December 21, 2010,” the banks told the apex court giving the sequence of events leading to the matter going before the DRT.
It said that Mallya and United Breweries (Holding) Ltd executed a corporate guarantee and personal guarantee on December 21, 2010 itself assuring the repayment of entire amount.
Since these accounts were not serviced and were declared as Non-Performing Assets, 13 banks led by SBI moved DRT for the recovery of the money.
Besides State Bank of India, other banks who gave loan to Mallya’s Kingfisher Airlines included State Bank of Baroda, State Bank of Mysore, Axis Bank, Corporation Bank, the Federal Bank, Indian Overseas Bank, Jammu and Kashmir Bank, IDBI Bank, Punjab National Bank, Punjab and Sind Bank, UCO Bank and United Bank of India.