A top source said India is seeking extradition of Mallya for defaulting on loans due to IDBI.
"We want to shatter this myth that by crossing boundaries you are out of bounds. Mallya extradition will act as an important test case," the source said.
The embattled businessman, who has been declared a proclaimed offender in India, was today arrested in London by the Scotland Yard on India's request for his extradition on fraud charges.
The flamboyant businessman, who once called himself 'The King of Good Times", was released on bail a few hours later.