Six months after businessman Vijay Mallya left the country and ‘relocated’ to the UK, the Bombay High Court on Monday said that he “couldn’t have come up with a better name than ‘Kingfisher’ for his entity, for just like the bird can fly away and no boundaries can prevent it, he flew away.”
The observations came while a bench led by Justice SC Dharmadhikari was hearing a plea filed by the service tax department, challenging a 2014 decision of the debt recovery tribunal that had waived off dues worth Rs 18 crore of the Kingfisher Airlines. The bench has now admitted the appeal and will decide whether the tribunal had powers to wave the same off.
Meanwhile, in a related matter, the same bench also granted six days to the service tax department to work out the details of selling or disposing of Mallya’s personal jet that was attached by the department earlier this year.
The directions came after the service tax department filed a plea seeking that the high court’s August 22 order approving the auction of the aircraft be stayed. The bench however, refused to pass any such order saying that it will not tolerate such sudden change of heart by the department.
“We want to make it clear that the authorities must take a decision now for we will not allow that aircraft to remain stationed at the domestic airport indefinitely. For some time now, the department has been indulging in a flip-flop and this is very risky. Sometimes the department shows enthusiasm and sometimes there’s complete lack of it,” the bench said.
At this, Additional Solicitor General Anil Singh sought the extra time submitting that both the union government and the service tax department were committed to selling the Airbus and only needed to work out some modalities.
On June 30, the department had conducted an e-auction for the Airbus advertising it as “designed exclusively for exotic and luxurious use” but recalled it after the highest bidder at the time offered just Rs 1 crore. Then in August this year, it conducted a second auction saying that it had set the reserve price of the airbus at Rs 152 crore. Mallya’s corporate jet Airbus 319 can carry 25 passengers and about 6 crew members.
Last week however, it told the court that it wished to recall the auction as the highest bidder who had bid for the airbus had bid only “81 per cent of its total cost.” HC has now scheduled the matter for further hearing on September 26 this year.
The Department meanwhile, has been litigating in HC against Mallya and his now defunct Kingfisher airlines since 2015. According to its plea, Mallya defaulted on payment of Rs 33 crore worth of Service Tax between the years 2008 and 2012 and the Rs 18 crore waive off is a part of the same dues. The department also alleges that Mallya owes the centre over Rs 500 crore as “disputed” service tax.