Mallya flew out of India on March 2, says A-G; SC issues notice on banks’ plea

Not after Vijay Mallya's blood and all banks want is to sit across the table to discuss modalities of recovery, Attorney General Rohatgi tells Supreme Court.

Written by Utkarsh Anand | New Delhi | Updated: March 10, 2016 5:46 pm
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THE Supreme Court Wednesday questioned public sector banks (PSBs) over advancing loans to Vijay Mallya, the founder-owner of Kingfisher Airlines, and his companies without securing enough assets in guarantee. It also issued a notice to Mallya who flew out of India on March 2, the day the banks sought the impounding of his passport as part of loan recovery proceedings.

When asked by a bench of Justices Kurian Joseph and Rohinton F Nariman, Attorney General Mukul Rohatgi said, “I have checked with the CBI. He (Mallya) left the country on March 2, the day we moved our application before the Debts Recovery Tribunal for impounding his passport… he has tremendous assets in the UK. So in all likelihood, he should be there. He has also been tweeting from there and says he is not an absconder. So he should be called here.”

Rohatgi requested the bench to issue an order summoning Mallya to the top court and deposit his passport till the recovery proceedings were underway. But the bench said it would first issue a notice to Mallya and wait for his response.

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“At this stage, we will issue a notice to him and his company. You serve notice and we will see on the next date what happens. You ask him to appear,” said the bench while posting the matter for another hearing on March 30.

Arguing on behalf of a consortium of 17 PSBs, Rohatgi began by pointing out that properties collateral as security for loans to Mallya and his companies were “very meagre”. “It (assets secured as guarantee) could be around one-tenth of the total loans, which is more than Rs 9,000 crore,” he said.

This submission prompted the bench to ask, “How did you (banks) give him loans when the total amount secured by you was only one-tenth of total value of the loans? Why was it not a secured loan? We will have to see if it is allowed. You gave loans even though you say only 10 per cent of assets were secured against the loan amount.”

Accepting that the majority of the loan was “unsecured”, the Attorney General argued that money was also given based on the worth of the brand and logo, and that they could not have foreseen that Kingfisher Airlines would fold up. “But I must also say that total value of his assets, including what he owns in foreign countries, is more than his total loan amount here,” he added.

The bench, however, underlined that if assets were not within the territorial jurisdiction of Indian courts, recovery through attachment of properties would be very difficult.

The AG also said: “We want to tell him (Mallya) that we are not after his blood. We want to sit across the table with him and discuss modalities of recovery.”

On Rohatgi’s suggestion, the bench issued notice to Kingfisher Airlines through Mallya and United Breweries while also allowing the banks to serve a notice on him electronically on his official email id as Rajya Sabha MP. The court also let the PSBs serve notice on the Airlines and Mallya through his lawyers.

On Tuesday, the SBI-led consortium of seventeen banks had moved the court to restrain Mallya as they feared he would fly to London to frustrate the loan recovery proceedings.

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  1. C
    cherans
    Mar 9, 2016 at 3:16 pm
    Good Governance by MODI
    Reply
    1. S
      Sudarshan Iyer
      Mar 9, 2016 at 8:41 pm
      In RAW's own jet?
      Reply
      1. P
        Possible
        Mar 10, 2016 at 4:14 am
        A new law would be ped to increase the interest rate on loans to compensate the money lost to Mallaya.
        Reply
        1. R
          Raj
          Mar 9, 2016 at 11:52 pm
          This is how Bs JParty is recovering black Money??
          Reply
          1. A
            Arvind
            Mar 9, 2016 at 11:14 am
            This is how Govt whether it Congress or BJP helps such accused Persons to run away from India to avoid further complication as such accused persons have helped them through donations.
            Reply
            1. A
              ashok
              Mar 9, 2016 at 1:38 pm
              The Bank heads should be taken to task and their properties must be seized for giving loans without proper security
              Reply
              1. A
                author
                Mar 9, 2016 at 11:07 am
                They are all buddy buddy at the top. the joke is on all Indians except the super rich and powerful. the GOI created Kanhaiya to let Maliaya escape with all the Malai.
                Reply
                1. I
                  Indian
                  Mar 10, 2016 at 5:05 am
                  Black money flowing out
                  Reply
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