In a major defeat to liquor baron Vijay Mallya, who is staying in london, a Bengaluru Debt Recovery Tribunal on Thursday ordered SBI-led consortium of banks to start the process of recovering Rs 6,203 crore, at an annual interest rate of 11.5 per cent, from tormented Vijay Mallya and his companies in the Kingfisher Airlines case.
This order will bring the curtains down on the nearly three-year long legal battle in the tribunal by the consortium of banks, comprising 17 banks, to recover the money owed by defunct airlines.
SBI, leading the consortium of banks, had filed three other applications also, including one seeking Mallya’s arrest and impounding his passport, for “defaulting” on loans.
“I hereby ask the bankers to start the process of recovery of Rs 6,203 crore at the interest rate of 11.5 per cent per annum from Mallya and his companies including UBHl, Kingfisher Finvest and Kingfisher Airlines,” DRT Presiding Officer K Sreenivasan said in his order.
Mallya was declared a Proclaimed Offender by a special PMlA court in Mumbai after he left the country on March 2 last year for the UK. It was on an Enforcement Directorate plea in connection with its money laundering probe against him in the bank loan default case.
The DRT had on March 7 last year restrained Mallya from withdrawing USD 75 million exit payment from British liquor giant Diageo as part of a severance package for quitting Diageo-owned United Spirits (USl) as its Chairman under a “sweetheart deal”. However, on July 13, the tribunal ruled that the order had become “infructuous” as USD 40 million had already been transferred prior to the March 7 directive.
In July last year, DRT also allowed another IA of the bankers for lifting of corporate veil to pierce the protection against personal liability enjoyed by individuals controlling Kingfisher Finvest, a holding company of Mallya.