Mallya offers to sell assets to repay bank loans

The 62-year-old liquor baron, who fled India on March 2, 2016, has been living in London since then despite summons from Indian courts and law enforcement agencies to appear before them for trial in various related cases.

Vijay Mallya (Photo: PTI/File)

Bengaluru: Fugitive tycoon Vijaya Mallya has petitioned the Karnataka High Court to permit him and his holding firm UBHL to sell their assets under its supervision and repay creditors, including state-run banks. "UBHL (United Breweries Holding Ltd) and myself have filed an application before the Karnataka High Court on June 22, setting out available assets of about Rs 13,900 crore," said Mallya from London in a statement released by his office here on Tuesday. The 62-year-old liquor baron, who fled India on March 2, 2016, has been living in London since then despite summons from Indian courts and law enforcement agencies to appear before them for trial in various related cases. Asserting that recovery of loans was a civil matter, Mallya said the Central Bureau of Investigation (CBI) and Enforcement Directorate (ED) had, however, criminalised it in his case by moving against him despite his intentions to settle the dues with the banks. "The CBI and ED seem determined to frame criminal charges against me on the pretext of non-payment to the banks. The motivation, however, seems to be to secure my presence in India to face charges than to determine if the evidence collected by them demonstrates criminal charges against me or to permit me to sell assets and repay creditors," he said. A consortium of 17 banks, led by the State Bank of India (SBI), gave Rs 5,500 crore loans to Mallya's now defunct Kingfisher Airlines since over a decade. Claiming that the bulk of the dues were on account of interest, Mallya said owing to injunctions, attachments and refusal to grant permission to sell the assets, this had kept mounting. "Consequently, the bloated figure of outstanding dues to the banks is on account of these mala fide actions. If CBI or ED object to my proposal and sale of assets, it will demonstrate that there is an agenda against me beyond recovery of dues to the banks," he claimed. Reiterating that he made efforts to settle the dues, Mallya said if politically motivated and extraneous factors interfere, there was nothing he could do, adding over Rs 600 crore has been recovered through sale of pledged assets and Rs 1,280 crore deposited with the Karnataka High Court since 2013. On the charges made by politicians and the media that he ran away from the country after "stealing" Rs 9,000 crore loaned to his airline, Mallya said some of the lending banks had also declared him a wilful defaulter, while the CBI and ED have filed chargesheets against him with "untenable and false allegations acting at the behest of the government and lending banks". "The ED also attached assets belonging to me, my group companies and owned and/or controlled by my family, under the Prevention of Money Laundering Act (PMLA), currently valued at Rs 13,900 crore," said Mallya. Observing that he became the "Poster Boy" of bank default and a lightning rod of public anger, he said though he wrote identical letters to Prime Minister Narendra Modi and Union Finance Minister Arun Jaitley on April 15, 2016 clarifying his position and seeking their intervention to settle the dues, there was no response from either of them. Recalling that all loans were approved by each bank, restructured and consolidated under a master debt recast pact in December 2010 with the Reserve Bank of India's (RBI) permission, he said the airline could not repay in time as the airline industry was under a great stress then. "The SBI wrote to the central bank (RBI) in January 2012 explaining that the position was beyond the airline's control, confirming that its promoters (UB Group) had infused substantial funds into it," said Mallya in the statement. When the banks went to the Debt Recovery Tribunal for recovery of Rs 6,200 crore, including Rs 5,000 crore principal amount and Rs 1,200 crore interest, Mallya made two settlement offers to the banks in the Supreme Court on March 29 and April 6, 2016. The first offer was for Rs 4,000 crore, which was revised to Rs 4,400 crore plus the assignment of a claim in a pending suit of Rs 2,000 crore. Noting that the twin offers need to be viewed in the context of one-time settlements made between state-run banks and borrowers in the past and recently the bank partial recoveries with haircuts under the Indian Insolvency and Bankruptcy Code before the National Company Law Tribunal, he noted that the consortium of banks rejected both.