Indian banks that were left in a lurch when liquor baron Vijay Mallya fled the country are hoping for a significant recovery in the days ahead. According to SBI Managing Director Arijit Basu, Indian banks are working very closely with various agencies, including in the UK, to recover the maximum possible out of assets owned by Mallya after a British court allowed them to search and seize his properties.
SBI is the leader of a consortium of 13 banks that lent about Rs 9,000 crore to Mallya's now defunct Kingfisher Airlines. "There are various laws which operate between different countries that allow us to go beyond our national borders. With the effort that we have made, we have got a worldwide freezing order," said Basu, adding, "We are very happy with the court order and, with this kind of order, we should be able to go after those assets".
Though he declined to peg a figure to the recovery the banks are hoping for, he said that lenders are optimistic that it will be a "significant amount of the debt if not whole amount". The consortium has already recovered Rs 963 crore from auction of Mallya's Indian assets.
The court order grants permission to the UK High Court Enforcement Officer and his agents to enter the 62-year-old tycoon's properties near London, including Ladywalk and Bramble Lodge in Tewin, Welwyn, where Mallya is currently based, to search for and take control of goods belonging to [him]". The order by Justice Byran, dated June 26, further noted that "The High Court Enforcement Officer, including any Enforcement Agent acting under his authority, may use reasonable force to enter the Property if necessary".
It relates to the UK's Tribunal Courts and Enforcement Act 2007 and follows a UK High Court ruling in May, which refused to overturn a worldwide order freezing Mallya's assets and upheld an Indian court's ruling that the Indian banks were entitled to recover funds. This marked the first recorded case of a judgment of the Debt Recovery Tribunal (DRT) in India being registered by the English High Court, setting a legal precedent.
Giving the background of the case, Basu said that the banks have worked really hard for the last 2-3 years to try and get this recovery order because many of the assets that Mallya holds are outside India. SBI has already appointed a valuer to assess the value of the embattled tycoon's assets.
Asked about a timeline for auction, Basu said that the banks are working very closely with all agencies and lawyer in London to see how the court order can be enforced. In the meantime, Mallya has made an application in the Court of Appeal seeking permission to appeal against the order, which remains pending.
With PTI inputs