 "UK court allows Indian banks to pursue surplus money from Mallya yacht sale")
A consortium of Indian banks led by the State Bank of India (SBI) has secured a UK High Court order as part of efforts to help them pursue some of the funds owed to them in unpaid debts by embattled Indian liquor tycoon Vijay Mallya.
In a ruling by Justice Phillips in the court's Business and Property division on Wednesday, the 13 Indian banks were given permission to use certain information disclosed in court as part of a worldwide freezing order (WFO) against the 62-year-old businessman in an unrelated case involving the sale of a luxury superyacht believed to be previously owned by Mallya before he abandoned it last year.
The 95-metre vessel named 'Indian Empress' was "arrested" in Malta in March as maritime professionals' union Nautilus made attempts to recover over $330,000 in unpaid wages and other costs on behalf of its members.
It was successfully auctioned to Sea Beauty Yachting Limited for 35 million euros in September and renamed 'NEOM'.
The UK High Court order dated November 28 will assist the Indian banks to pursue any surplus money from that sale in Malta courts after all the creditors have been paid off.
Nautilus strategic organiser Danny McGowan said the maritime union has been collating members' claims and other details to ensure that the sums due are paid to them.
"The court has been completing the procedures to pay all the creditors including suppliers, service providers and financiers who were owed money by the former owner, multi-millionaire Vijay Mallya," Nautilus said.
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In a ruling earlier this year, a UK High Court judge had refused to overturn a worldwide order freezing Mallya's assets and upheld an Indian court's ruling that the consortium of 13 Indian banks were entitled to recover funds amounting to nearly 1.145 billion pounds.
TLT LLP, the law firm which had won the landmark case for the banks in May, has been representing them in their efforts to recover their dues as part of the WFO.
The WFO contains an undertaking preventing the banks from using the information provided in response to the disclosure provisions in the case for any other civil or criminal proceedings without the court's prior permission.
However, under this week's latest ruling, the banks have been given permission to use certain information provided pursuant to the WFO in respect of arrest proceedings instigated in Malta by the maritime creditors of the 'Indian Empress' yacht.
Following the sale and the creditors being paid off, there is likely to be a surplus of money that would be due back to the yacht's owners.
The 13 banks comprise SBI, Bank of Baroda, Corporation bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu & Kashmir Bank, Punjab & Sind Bank, Punjab National Bank, State Bank of Mysore, UCO Bank, United Bank of India and JM Financial Asset Reconstruction Co Pvt Ltd.
The banks are seeking to secure that surplus in the Maltese courts rather than it being paid to the legal owner.
Meanwhile, Mallya remains on bail on an extradition warrant executed by the Scotland Yard last year on fraud and money laundering charges brought by the Indian government, amounting to nearly Rs 90 billion.
A ruling at the end of his extradition trial is expected at Westminster Magistrates' Court in London next month.
In separate legal proceedings, he is also fighting to save his posh London home from foreclosure by Swiss bank UBS.
Earlier this month, he suffered a setback in that case after the UK High Court rejected many of the arguments relied on by his legal team. The case is scheduled for trial in May 2019.