Restore Vijay Mallya’s properties worth ₹5,646.54 crore to clear bank dues: PMLA court

The special Prevention of Money Laundering Act (PMLA) court, in two separate orders passed within the past 10 days, has directed restoration of properties worth ₹5,646

The special Prevention of Money Laundering Act (PMLA) court, in two separate orders passed within the past 10 days, has directed restoration of properties worth ₹5,646.54 crores belonging to Kingfisher Airlines and fugitive businessman Vijay Mallya, to the State Bank of India (SBI) bank and its consortium. This will enable banks to sell these properties which were attached by the Enforcement Directorate (ED) during the probe, and recover dues.

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The SBI heading the consortium of banks had approached the special PMLA court for release of the properties which were attached by the ED during the investigation into money laundering allegations against Mallya.

The court held that the quantifiable loss suffered by the bank is ₹6,203 crores and the properties asked for restoration is insufficient to meet the loss, suffered by the banks. Hence, the court on May 24, ordered the release of the properties worth ₹4,234.84 crores, while on Tuesday the special court has ordered the release of the properties worth ₹1,411.70 crores.

The properties which are now released include properties in UB City, Bengaluru worth ₹712.94, his under-construction flats in Kingfisher tower worth ₹564.25 crores, several pledged and unpledged shares and many other properties owned by Mallya through various companies in Bengaluru.

The bank has raised a claim worth ₹6,203.35 crores with interest and sought the release of the properties to enable the recovery officer to proceed with the proceedings. The ED had given no objection certificate to the release of the properties to SBI. However, the plea was opposed by Mallya’s legal team and lawyers of the companies having an interest in these properties.

Mallya’s legal team had challenged the jurisdiction of the PMLA court. It was argued that merely giving of a personal guarantee, does not connect Mallya in any way with the offence of money laundering or the proceeds of crime.

“The property is not involved in money laundering, therefore this application is premature. The banks cannot ask for the sale of properties and the court cannot hand over the said properties. It is also clear that the said properties are not proceeds of crime. The said properties were acquired many years ago,” the defence argued opposing the plea of the bank.

The court negated the claim of defence and said, at present, this court is not required to finally decide the criminal liability of the accused persons. “It is needless to mention that both Kingfisher Airlines and Force India Formula No. 1, companies were under the command and control of Dr Vijay Mallya,” the court noted while releasing the properties to SBI.

“Despite the said poor financial conditions, the same company had transferred loan amount, which it received from the applicant’s banks to Force India Formula No. 1 Racing Team. The transferred amount was shown as payments for operating expenses of flight operations,” the court noted.

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