Vijay Mallya, known for his extravagant lifestyle and his once premium, now-defunct Kingfisher Airlines, has been in the news for a slew of pending court cases. On Tuesday, the Karnataka High Court announced that the United Breweries (Holdings) Limited (Mallya owns a 52.34 per cent in the company) should be wound up to recover the losses of Kingfisher Airlines, owed to several banks. In the order, Justice Vineet Kothari stated, “This court has come to a conclusion that the respondent company, UBHL deserves to be wound up for failure to discharge their duties to pay up their creditors.”
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The following is a chronology of events, from the genesis of the airlines to its fall and the events that took place in the aftermath.
2005: May 2005 – Chairman of the United Breweries (Holdings) Limited Vijay Mallya establishes Kingfisher Airlines. The airlines is slated to be a premium, state-of-the-art, world-class brand.
2006: Kingfisher Airlines approach the IDBI Bank for a loan that would fund its purchase of aircrafts. Mallya had a murky history with the IDBI with regard to his Mangalore Chemicals and Fertilisers acquisition. The committee therefore decides to decline Mallya’s proposal. Mallya, unfazed, approaches other banks for loans and gets it.
2007: Kingfisher Airlines is doing well and a highly enthusiastic Mallya decides to acquire the almost bankrupt Air Deccan.
- Air Deccan deal is signed and sealed. United Breweries Limited pays Rs 550 crore for a 26 per cent stake in the carrier. Arguably a wrong move that possibly led to the downfall of United Breweries Limited.
- March 2008 – Kingfisher Airlines owes a debt of Rs. 934 crores – due to a heightened spike in oil prices and the stress of working a high-cost and low-cost airline company together.
- September 2008 – Kingfisher Airlines goes abroad for the first time, providing flights between Bengaluru and London.
- The airlines now owes a debt of Rs. 5,665 crores, which grows into Rs. 7,000 crores.
- Kingfisher Airlines continues to enjoy popularity. The IDBI changes its mind and decides to provide a loan of Rs. 900 crore to the airlines.
- November 2010 – Banks inform the airlines that it would give it nine months to pay back the loan.
- This does nothing to resurrect a failing airlines and Mallya, now a Member of Parliament, continues to live an extravagant lifestyle.
2011 – 2012
- Mallya withdraws a large sum of money — Rs. 33.46 crore for each respective year — from Kingfisher Airlines as salary .
- Kingfisher Airlines’ license to operate is confiscated. As a result, it stops paying its employees salaries.
- As of March 2016, Kingfisher Airlines owes Rs. 3000 crore to 3000 employees in terms of salary. It owes banks such as SBI and IDBI a colossal sum of US $1 billion as loan.
- March 2013 – Kingfisher Airlines net worth falls to a negative of Rs. 12,919 crore.
- UBHL is approached for a payment of Rs. 6,493 crore in loans for Kingfisher Airlines by a consortium of banks, including the SBI.
- Mallya assures that a large portion of the loan will be settled soon.
- United Bank of India announces Mallya a ‘wilful defaulter’. Other banks like SBI and PNB follow suit.
- November 2015 – Finance Minister Arun Jaitley declares that the airlines has a debt of Rs. 9,091.40 crore.
- April 2015 – Mumbai International Airport Private Limited sells Mallya’s personal aircraft to recover funds. It’s sold at Rs. 22 lakhs.
- The Service Tax Department holds the arlines accountable for a non-payment of Rs. 115 crore.
- The Department approaches Bombay High Court to seize Mallya’s passport, forcing him to appear in court.
- February 2016 – Mallya is asked by the board at United Spirits Limited to step down.
- March 2016 – In a plea to stop Mallya from escaping the country, a syndicate of banks approached the Supreme Court of India. Mallaya however, has already left the country, taking refuge near London.
- In Hyderabad, a special magistrate court issues a non-bailable arrest warrant (NBW) against Mallya for not appearing in court for a slew of pending cases.
- April 2016 –The Enforcement Directorate approaches a special court in Mumbai to issue another non-bailable arrest warrant under the Prevention of Money Laundering Act, 2002. The court goes ahead and does so.
- Reports surface alleging that Mallya has transferred $590 million abroad.