A British court on Monday granted a bankruptcy order against Vijay Mallya, paving the way for a consortium of Indian banks led by the State Bank of India (SBI) to pursue a worldwide freezing order to seek repayment of debt owed by the now-defunct Kingfisher Airlines. “As at 15.42 [UK time], I adjudicate Dr Mallya bankrupt,” Chief Insolvencies and Companies Court (ICC) Judge Michael Briggs said in his ruling during a virtual hearing of the Chancery Division of the High Court here.
Mallya, who fled to the UK, is being probed by the ED and the CBI for the alleged bank fraud linked to the operations of his now defunct Kingfisher Airlines. Here’s a time line of the liquor baron’s extradition fight from the UK and accusations of fraud and money laundering in India, where he owes 17 Indian banks an estimated Rs 9,000 crore.
• Mallya inherited UB Spirits from his father, which is best known for the Kingfisher beer brand, and developed it into India’s largest spirits producer. At the age of 28, he was named chairman of the UB Group.
• However, the group’s other businesses were not as successful, with Kingfisher Airlines being the most notable loss. The airline company, which he founded in 2005, proved to be his undoing when its business model collapsed in 2008 due to a global recession and skyrocketing fuel prices.
• Kingfisher Airlines, which began operations in 2005, was forced to shut down in 2012 due to a mounting debt burden that made it difficult for the airline to continue operations. The airline is also under investigation for possible money laundering and financial violations.
• Mallya moved to the United Kingdom in 2016 after facing pressure from lenders following the airline’s demise. He has publicly stated that he has been working to repay his debts since 2016.
• He departed the country on March 2, 2016, the same day a group of public-sector banks filed a complaint with the Debt Recovery Tribunal. The Fugitive Economic Offenders Act designated him as a fugitive economic offender in January 2019.
• The fugitive refuted all claims and publicly promised to return the lenders the whole principle amount owed.
• Mallya published an open letter defending himself just before leaving the country in 2016. “All enquiries conducted have failed to find evidence of misappropriation of funds by Kingfisher Airlines or myself. Despite pledging blue-chip securities and depositing significant amounts in court, a successful disinformation campaign has ensured my becoming the poster boy of all bank NPAs,” he had said in the letter.
• In January 2021, the 65-year-old businessman applied to Home Secretary Priti Patel for “another route” to be able to stay in the UK. His legal challenge to the central government’s extradition request was turned down at the Supreme Court level in the UK last year.
• In the same month, the United Kingdom government told the Indian side that Mallya cannot be extradited until a confidential “legal issue” concerning him is resolved. The UK refused to provide details of this “issue”, saying it was judicial in nature. It also refused to disclose how long it would take to resolve the issue, though reassuring that it knew how important the Mallya case was to the government of India.
• On June 1, a special PMLA court in Mumbai allowed the restoration of Mallya’s properties worth Rs 5,646.54 crore to banks.
• Two days later it was reported that a consortium of lenders led by SBI could now sell certain real estate properties and securities belonging to Mallya to recover loans turned bad with failure of Kingfisher Airlines. A consortium of 11 banks that gave Mallya loans, led by State Bank of India (SBI), had approached a special Prevention of Money Laundering Act (PMLA) court seeking restoration of his properties seized by the Enforcement Directorate.
• On July 24, Foreign Secretary Harsh Vardhan Shringla said that India has made its best case on Mallya being and the central government has the best assurance from the UK authorities of his extradition to face charges of fraud and money laundering related to unpaid loans to his now-defunct Kingfisher Airlines.
• The foreign secretary said that the UK’s response on the extradition case of Mallya as been positive and he likely to be deported back to India. “We have been given to understand that there is a process in place and that the British side is working on his (Mallya) extradition based on that process,” Shringla told reporters, in response to a question over the delay in Mallya’s extradition. “We have no reason to doubt that assurance that this man wanted for economic offences in India, owes a lot of money in India has to be returned to the country. We have made our best case and they have given their best assurance,” said the Foreign Secretary.
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Source: News18