Vijay Mallya opposes bank consortium application for liquidation of attached properties
Senior counsel Amit Desai representing fugitive billionaire Vijay Mallya on Monday has opposed the application filed by a consortium of 12 banks led by State Bank of India (SBI).
The consortium was seeking the release of Mallya's assets that the Enforcement Directorate (ED) has attached so that these can be sold "immediately" to recover the debts. The application has been filed before a special CBI court in Mumbai along with cases under the Prevention of Money Laundering Act (PMLA).
Desai said, "The consortium has other remedies. They should have gone before the civil forum and not come before this court. These issues will be decided by the Karnataka High Court if they really want to settle."
Desai added that Mallya has been saying that everything should be sold off and the money should be handed over to all those people to whom he owes. "We have been suggesting for the last one year, appoint a retired judge, sell off everything, don't involve me (Mallya) and take everything."
Desai said that the special court in Mumbai was not the right forum for passing the order on liquidating the property as the right forum was the Karnataka High Court.
The advocate added, "Before Karnataka High Court, everyone is there. It is not just the banks, the employees of Kingfisher and every other entity is there. Here the employees are not part of the proceedings while they are the ones screaming on television."
The principal amount that Mallya owes to the banks is around Rs 5,000 crore which has risen to around Rs 12,000 crore with the 11.5 per cent interest that has been mounting because of non-payment of dues.
According to the people in the know of the case, when the investigating agencies had attached Mallya's properties, which mainly consists of shares of some of his companies, the attachment was worth only Rs 2,000. But over the years with the share prices going up, his stakes have reached Rs 15,000 crore and thus there is "ample for everyone to get their share".
During the hearing, the lawyer representing the consortium told the court that Mallya had already been declared a fugitive and that his attached properties should go to those who are legally entitled like SBI and others.
The advocate told the court, "One does not know when he will come back and until then public money cannot be kept in abeyance. There are various interveners in the case but the SBI consortium has first claim because of various orders passed by this court and this is the only court where I can seek this relief as it is this court which has passed orders of attachment."
Advocate D P Singh representing the enforcement agency got up to say that he only wanted to make a correction in the argument made by the consortium lawyer.
"He said we don't have an objection, we have agreed. I just want to say that we cannot give the property just like that. Suppose he is held not guilty by the court after trial. For that, adequate security needs to be taken from the banks." The advocate representing the consortium said that they had already promised to give an undertaking of that sort before the Debt Recovery Tribunal.
Desai pointed to the court that the attachment of properties by the agency had not been done following due course of law. On the offer of SBI giving an undertaking or a guarantee, Desai said, "Which bank survives and which does not, it is only a matter of time these days. This guarantee is not maintainable."
The court will further hear the arguments on July 16.