‘Time to move on’: Bombay High Court to Vijay Mallya, SBI as ₹15,000 crore recovery takes centre stage

The Bombay High Court has indicated that a long-running commercial dispute involving fugitive businessman Vijay Mallya and a consortium of banks led by the State Bank of India (SBI) may be nearing its end. The court asked the Enforcement Directorate (ED) to clarify whether the settlement and asset-recovery process has been completed, after Mallya’s lawyer argued that his 2020 petition challenging asset seizure had become largely irrelevant.

Bombay HC: ‘Issue needs to be put to an end’

Mallya’s 2020 petition challenged a special Prevention of Money Laundering Act (PMLA) court order that allowed the SBI-led consortium to use assets confiscated by the ED to recover outstanding dues linked to Kingfisher Airlines, according to Hindustan Times.

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Senior advocate Amit Desai, appearing for Mallya, told the court that the petition was filed when settlement discussions were still underway. He argued that circumstances had changed over the past six years, with most of the assets covered by the original petition already attached or dealt with.

Justice Milind Jadhav was quoted as saying by Hindustan Times, “Actually, this issue needs to be put to an end. The idea is to move on… otherwise the relations and the economy of the country suffer.”

The court directed the ED to file an affidavit stating whether the settlement process had concluded and whether “everything is done and dusted”. It will decide the next course of action after hearing the concerned ED deputy director.

Mallya claims banks recovered ₹15,000 crore

A major point raised during the hearing was the amount recovered by public sector banks. Desai claimed that banks had recovered around ₹15,000 crore from Mallya, compared with the original claimed dues of ₹6,203.35 crore, excluding interest. “Public sector banks keeping this matter pending is unfortunate,” Desai said, according to Hindustan Times.

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He further argued, “The RBI audit itself says it’s an airline’s business failure and nothing else. Banks have taken away ₹15,000 crore and now they say sorry. That’s not good enough.” The recovery figure cited by Mallya’s counsel is more than twice the original claimed principal amount, although the accounting of recoveries, interest and liabilities remains part of the wider legal proceedings.

How the asset recovery began

The dispute dates back to proceedings involving the ED and Mallya’s assets. In February 2019, the ED told a special PMLA court that it had no objection to the SBI-led consortium liquidating confiscated assets to recover outstanding loans. Mallya had been declared a fugitive economic offender in January 2019.

His 2020 petition subsequently challenged the order permitting the lenders to use those confiscated assets for debt recovery.

Criminal cases will continue

The Bombay High Court made it clear that bringing the commercial dispute to an end would not affect the criminal proceedings against Mallya. The court said the criminal prosecution must still be “taken to its logical end.”

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Mallya left India in March 2016 amid mounting legal pressure and has remained in the United Kingdom. The CBI had registered an FIR against him in July 2015 over alleged irregularities in loans obtained by Kingfisher Airlines. He faces cases involving alleged loan defaults, fraud, money laundering and financial irregularities.

Although UK courts have approved his extradition to India, his return has been delayed by further legal proceedings in Britain. The latest Bombay High Court hearing, however, concerns the separate commercial dispute over asset recovery.