Kingfisher could not justify remitting Rs 423 cr of loan abroad: ED

NEW DELHI: Liquor baron Vijay Mallya’s Kingfisher Airlines allegedly remitted abroad Rs 423 crore out of a Rs 864 crore loan from IDBI bank but could not justify

NEW DELHI: Liquor baron Vijay Mallya’s Kingfisher Airlines allegedly remitted abroad Rs 423 crore out of a Rs 864 crore loan from IDBI bank but could not justify the alleged diversion, according to Enforcement Directorate’s money-laundering probe in the case.

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“ED’s probe revealed that the firm remitted Rs 423 crore outside India out of a total loan of Rs 864 crore received from IDBI bank,” said an agency source. “The airline remitted the huge fund abroad on pretexts, such as aircraft-lease rentals, but no supporting documents have been furnished so far to substantiate its claims,” said the source.

“While the bank loan itself was obtained in a questionable manner, a part of it is therefore suspected to have been siphoned off abroad, in a calculated manner,” he said. In March, the Enforcement Directorate (ED) that probes financial crimes said it registered the money-laundering case against Mallya, the defunct Kingfisher Airlines and unknown bank officials on the basis of a Central Bureau of Investigation (CBI) probe against them for alleged default on loan by the bank.

The loan was sanctioned to the airline against the “collateral security of Kingfisher brand, corporate guarantee of the group firm and personal guarantee of Vijay Mallya”, out of which Rs 807 crore remained allegedly unpaid, according to ED.

Mallya has denied ED’s allegations related to wrongdoing by him or the airline.

The loan was sanctioned allegedly in an “extraordinary haste” without verifying the “quality and value of the said security independently”, said the source. The probe indicated that the firm allegedly defaulted on the loan’s payment “from the very beginning.”

Mallya’s alleged loan default of over Rs 9,000 crore made headlines since the industrialist left India for the UK in March.