Sounding combative, liquor baron Vijay Mallya said bankers won’t get any money by getting him arrested or revoking his passport. In his first interview since he moved to the UK, as he puts it, in “forced exile”, Vijay Mallya spoke to the Financial Times on the Kingfisher loan default case.
India has asked the UK to deport Mallya, whose Kingfisher Airlines has been accused of defaulting bank loans of over Rs 9,000 crore, citing the revocation of his passport and a non-bailable warrant against him.
1. ‘Interested in Settlement With KFA Bankers’
We have always been in dialogue with banks. We wish to settle.
It must be remembered that the settlement offer that Mallya made came nearly four years after the airline went bust and years after several banks labelled him a wilful defaulter. The consortium of banks alleged in the Supreme Court that Mallya is not cooperating in the investigation of cases lodged against him and was averse to disclosing foreign assets.
2. Will He Up the Settlement Amount
The banks need to consider that there are other creditors who need to be paid, we can’t seem to be giving preference to banks just because of the extraordinary pressure being put on me by government agencies.
While he says he is ready to settle, Mallya remained unclear about whether he will consider making a higher offer. Banks have already rejected the Rs 4,000 crore partial settlement that his lawyers had made before the Supreme Court.
3. ‘Passport Revoked With Unprecedented Haste’
The manner in which my passport was suspended and revoked is unprecedented and was done with extraordinary haste.
The government last week revoked Mallya’s diplomatic passport – given to him by virtue of his status as a member of the Rajya Sabha – in an effort to bring him back to India. It suspended the passport on 15 April for four weeks at the request of the Enforcement Directorate (ED), which is probing money-laundering allegations against him. The revocation of Mallya’s passport and the process to extradite him only began after he refused to turn up before the Enforcement Directorate after three summonses issued to him.
4. ‘In Forced Exile”
Mallya said he is in a “forced exile” and has no plans to return to India where things are flying at him “fast and furious”.
Mallya left India on 2 March citing urgent business in the UK. This, after the Supreme Court has issued a notice to Vijay Mallya on a plea filed by the consortium of PSU banks headed by State Bank of India.
5. On the Extent of His Dues & the Role of the Media
I don’t know whether it’s banks or media or a combination of the two. That’s how India is. I haven’t been able to understand where the Rs 9,000 crore figure came from. If there is a reason and rational all around banks and other creditors can be settled.
He also seems to blame the media for turning public opinion against him.
It is important to understand the environment in India today. The electronic media is playing a huge role not just in moulding public opinion, but in inflaming the government to a very large extent.
6. The Wilful Defaulter Tag
Don’t understand how I came to be labelled a wilful defaulter. Invested over Rs 6,000 crore in KFA. Tried everything to save the airline. A combination of macro factors and government policies could not save KFA.
According to RBI, a default is wilful when it fulfils one of the following four conditions:
- A borrower (or an entity) does not pay up even when it has the capacity to pay.
- A borrower has not used the loan for the purpose borrowed and diverted the money elsewhere.
- A borrower has siphoned off the funds and the money is not available with it in the form of other assets.
- A borrower sells assets given as security against the loan without informing lenders.
State Bank of India has alleged that funds were diverted several times from Kingfisher Airlines to various UB Group companies and other firms. It said as much in an August 2014 notice sent to Mallya, Kingfisher, United Breweries, and its directors, and filed in the Bombay High Court. The notice also alleged that United Breweries (Holdings), the parent company, had been “deliberately avoiding payment to lenders”.
7. On the Charge of Money-Laundering
The government can appoint the world’s best forensic auditor to audit the accounts of Kingfisher and audit how banks loans were utilised. I am sure they are not going to find anything because that’s the truth.
There is already a case of money-laundering registered against Mallya and some others by the Enforcement Directorate in connection with the alleged default of over Rs 900 crore loan from IDBI bank. The agency recently has filed charges under the Prevention of Money Laundering Act (PMLA) based on an FIR registered last year by CBI in the same case.
It is in connection to this case that the ED has repeatedly summoned Mallya for which he failed to appear.
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