 "SBI told to adjust Mallya's Rs 2k-cr HC deposit")
The Debt Recovery Tribunal (DRT) here advised State Bank of India (SBI) to consider the option of adjusting Rs 2,000 crore deposited by Vijay Mallya in the high court against loans taken to run the now-defunct Kingfisher Airlines.
Presiding Officer C R Benakanahalli made an oral comment that the adjustment of dues would bring down liabilities for the banks and reduce interest. DRT was hearing the arguments in the case, first filed in 2013, to recover Rs 7,200 crore owed by Mallya and his companies.
Mallya had said in his application that the banks had already received Rs 1,244 crore in pledged shares since April 2013. An additional Rs 1,250 crore has been deposited in the HC belonging to his United Breweries (Holdings).
DRT also directed the counsels to stop filing additional interlocutory applications, saying it would make it difficult to comply with the Supreme Court’s directive to complete the case before July 9. The Tribunal has set the next day of hearing on June 13.
Mallya, reportedly in exile in the UK, owes Rs 7,200 crore to a consortium of bankers led by State Bank of India, for loans taken to run the Kingfisher. The banks say Mallya had given personal guarantees, apart from pledging his stake in UB Group companies to raise funds for the airline. This resulted in Mallya losing control over his liquor empire to global players - Diageo in spirits and Heineken in beverages. Mallya claims UB Group pumped Rs 4,000 crore in Kingfisher, in addition to the loans taken from banks.
To recover the loans, the banks first filed a case in 2013 against Mallya in DRT here, where UB Group is based. Since then, they have filed 25 more applications, including a petition to direct Diageo and United Spirits to stop payment of $75 mn for a non-compete agreement signed with Mallya. Diageo paid Mallya $40 mn immediately after the agreement was signed in February.
The SC asked Mallya to disclose his and his family’s assets in India and abroad, while asking DRT to complete the proceedings before July 9.
Mallya says he is keen to arrive at a settlement with the banks.
Presiding Officer C R Benakanahalli made an oral comment that the adjustment of dues would bring down liabilities for the banks and reduce interest. DRT was hearing the arguments in the case, first filed in 2013, to recover Rs 7,200 crore owed by Mallya and his companies.
Mallya had said in his application that the banks had already received Rs 1,244 crore in pledged shares since April 2013. An additional Rs 1,250 crore has been deposited in the HC belonging to his United Breweries (Holdings).
DRT also directed the counsels to stop filing additional interlocutory applications, saying it would make it difficult to comply with the Supreme Court’s directive to complete the case before July 9. The Tribunal has set the next day of hearing on June 13.
Mallya, reportedly in exile in the UK, owes Rs 7,200 crore to a consortium of bankers led by State Bank of India, for loans taken to run the Kingfisher. The banks say Mallya had given personal guarantees, apart from pledging his stake in UB Group companies to raise funds for the airline. This resulted in Mallya losing control over his liquor empire to global players - Diageo in spirits and Heineken in beverages. Mallya claims UB Group pumped Rs 4,000 crore in Kingfisher, in addition to the loans taken from banks.
To recover the loans, the banks first filed a case in 2013 against Mallya in DRT here, where UB Group is based. Since then, they have filed 25 more applications, including a petition to direct Diageo and United Spirits to stop payment of $75 mn for a non-compete agreement signed with Mallya. Diageo paid Mallya $40 mn immediately after the agreement was signed in February.
The SC asked Mallya to disclose his and his family’s assets in India and abroad, while asking DRT to complete the proceedings before July 9.
Mallya says he is keen to arrive at a settlement with the banks.
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