The Enforcement Directorate (ED) will send letters rogatory (LR) to the US, the UK and Europe requesting the competent foreign authorities to assist it in attachment of over ten foreign assets of Vijay Mallya, chairman of the now defunct Kingfisher Airlines in connection with a money laundering case, said sources familiar with the development.
The move by the ED comes after a special court in Mumbai that declared Mallya a proclaimed offender on November 10, declined to pass orders for attachment of Mallya’s foreign assets citing jurisdictional issues.
“The agency has identified over ten foreign properties of Mallya and will use the LR route to attach these properties. The agency has already prepared the LRs,” said a source.
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A letter rogatory is a formal request to a foreign court seeking judicial assistance in probing an entity in another country.
Mallya who is currently in the UK, owns properties in London, New York, California, Johannesburg, Mediterranean islands off the French Riviera among others. But it is not known how many of these are collaterals to loans. As of now the agency has attached assets of Mallya and Kingfisher in India worth Rs 9661 crore under the Prevention of Money Laundering Act (PMLA) after the agency expanded its probe into the case.
On August 23, the ED registered a fresh case against Mallya and Kingfisher for a loan default of Rs6027 crore. The new case is based on a complaint filed by a SBI-led consortium with the CBI. Earlier the CBI had filed a fresh case under IPC sections related to criminal conspiracy and cheating against Mallya on the basis of a complaint received from SBI-led 17-bank consortium.
Currently, Kingfisher owes over Rs 9000 crore to 17 banks including the State Bank of India (SBI), IDBI Bank, Punjab National Bank, Bank of India, Bank of Baroda, United Bank of India, Central Bank, UCO Bank, Corporation Bank, Indian Overseas Bank , Federal Bank , Punjab and Sind Bank, Axis Bank among others.
In June, the ED had sought the proclamation notice to be issued against Mallya as it said he had “multiple” arrest warrants pending against him, including a non-bailable warrant (NBW) under the PMLA, and that the agency wants him to join the probe “in person”.
On Wednesday, Finance Minister Arun Jaitley in Rajya Sabha said that a write-off of loan does not mean that the bank is not going to pursue the bad debt.
“Bad loans write-off doesn’t mean we won’t pursue it. NDA government has inherited a legacy of bad loans,” Jaitley said in Rajya Sabha.
Jaitley’s statement came after DNA reported that State Bank of India has written off bad loans worth Rs 7,016 crore of 62 wilful defaulters including Kingfisher from its books by moving them to an Advance Under Collection Account (AUCA).