In an attempt to end his legal problems over Rs 6,900 crore of unpaid loans, beleaguered liquor baron and owner of now-defunct Kingfisher Airlines Vijay Mallya has agreed to pay Rs 4,000 crore to the banks by September.
Making this proposal in a sealed cover to the Supreme Court, Mallya’s lawyers said while a sum of Rs 2,000 crore will be paid upfront, the remaining Rs 2,000 crore will be paid by September. In the proposal, jointly submitted by Mallya, Kingfisher Airlines, United Breweries Holdings limited and Kingfisher Finvest (India) limited, Mallya further suggested that subject to winning a suit filed by Kingfisher Airlines against GE before a Bangalore court, Mallya will pay another Rs 2,000 crore to the banks.
The Bench of Justices Kurian Joseph and Rohington F Nariman took the proposal on record and asked the counsel appearing for the consortium of banks, led by State Bank of India, to respond to the same by April 7, the next date of hearing.
Senior advocate SS Naganand, who appeared for the banks, said that the outstanding loan amount against Mallya and his companies was Rs 6,903 crore, on which interest accumulated comes to close to Rs 9,000 crore. “The proposal is just to pay Rs 4,000 crore and the rest is subject to the result of the suit,” Naganand said. The Bench replied, “It is up to you to accept or reject. Tell us your response within a week.”
Appearing for Mallya, senior advocate CS Vaidyanathan told the court that ever since the banks approached the SC for recovery of loans, Mallya spoke to the concerned banks via video conference twice. The court asked, “Are you (Mallya) back in IndiaIJ” Vaidyanathan replied that in the present age, one need not be physically present to hold meetings. “Even yesterday we had a video conference,” he said.
Vaidyanathan also conveyed his client’s reservation to place the proposal in public domain. “Media hype has unfortunately destroyed my client’s case. There is a surcharged atmosphere if one watches some of the TV channels. The proposal should not be made available to the media,” he said.
The Bench felt there should be no objection to keep it under wraps from the media. “The media stands for public interest. Our only intention is to see that the dues are repaid to the banks. It is for the public to consider it dispassionately.”
The banks had approached the apex court to freeze Mallya’s passport. But even before the court issued notice on their petition on March 9, Mallya had left for london. The loans were issued by banks for varying amounts to Kingfisher Airlines securing it against the brand value. By way of a Corporate Guarantee executed by Mallya, a personal guarantee was offered for repayment of the entire amount which remained outstanding till date.