DRT go-ahead to recover Rs 6,200 crore may see the once liquor baron moving a higher court
The Bangalore Debt Recovery Tribunal (DRT) has allowed banks to attach properties and recover their Rs 6,200 crore taken by Vijay Mallya for his Kingfisher Airlines.
Along with the interest accruals, this amount has now ballooned to Rs 9,000 crore. Banks had approached the DRT to allow them to recover their dues after Mallya tried to stall the bank's efforts at recovery.
"I hereby ask the bankers to start the process of recovery of Rs 6,203 crore at the interest rate of 11.5% per annum from Mallya and his companies including United Breweries Holdings Ltd, Kingfisher Finvest and Kingfisher Airlines," DRT presiding officer K Sreenivasan said in his order.
A senior banker in the consortium said, "What the presiding officer said was that the amount of over Rs 6,203.35 crore is to be recovered from Mallya and his companies with an interest rate of 11.5% from the date of filing the application which was in 2013. The four defendants in this case in are Kingfisher Airlines, United Breweries Holdings, Vijay Mallya and Kingfisher Finvest."
In March last year, SBI moved DRT for the second time to seek an arrest warrant, revoking of passport, details of all his assets and liabilities as well as an order to attach the $75 million payout by spirits maker Diageo Plc to Mallya for stepping down from his post as chairman of United Spirits Ltd (USL).
Another banker in the consortium said, "This will give us a leeway to move forward. But this doesn't stop Mallya from approaching a higher court. We have so far attached the Kingfisher House in Mumbai and his villa in Goa but we are unable to sell it. "
The banks were trying to ringfence Mallya through both the DRT and also through Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (Sarfesi Act) to attach and recover the dues. But when the Sarfesi Act allows the banks to attach property or an asset Mallya would approach the DRT or the district magistrate to stall the process. The Goa High court had allowed the banks to attach Mallya's villa, but the company approached the district magistrate that led to a delay in the banks getting a go-ahead to attach it.
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