London: Embattled liquor tycoon Vijay Mallya, undergoing an extradition trial in a UK court over fraud and money laundering charges by Indian authorities, today lost a lawsuit filed by 13 Indian banks in the UK High Court seeking to collect from him more than USD 1.55 billion.
Judge Andrew Henshaw refused to overturn a worldwide order freezing Mallya’s assets and upheld an Indian court’s ruling that a consortium of 13 Indian banks were entitled to recover funds amounting to nearly USD 1.55 billion (1.145 billion pounds).
The victory for the banks will enable them to enforce the Indian judgment against Mallya’s assets in England and Wales.
The worldwide freezing order prevents him from removing any assets from England and Wales up to that value or to in any way dispose of, deal with or diminish the value of his assets in or outside of this jurisdiction, up to the same value.
The claim brought by 13 Indian banks against the 62-year-old businessman was heard in the High Court last month.
The litigation in the Queen’s Bench Division of the commercial court in England’s High Court of Justice lists the State Bank of India, Bank of Baroda, Corporation bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu &a Kashmir Bank, Punjab & Sind Bank, Punjab National Bank, State Bank of Mysore, UCO Bank, United Bank of India and JM Financial Asset Reconstruction Co.
Pvt Ltd as the applicants. Mallya and related concerns Ladywalk LLP, Rose Capital Ventures Ltd and Orange India Holdings are listed as respondents.
The claim relates to a judgment of the Debt Recovery Tribunal (DRT) in Karnataka, which concluded that Mallya was “liable” to the banks in the sum of INR 62,033,503,879.42 plus interest.
The “freezing order” involves Mallya and related concerns being “restrained” until further order, from removing from the jurisdiction any of their assets in the jurisdiction up to a limit of 1,145,000,000 pounds and in any way disposing of, dealing with or diminishing the value of any of their assets whether they are inside or outside the jurisdiction up to the same value”.
The UK court had earlier upheld the Indian court’s injunction and given Mallya’s lawyers more time to respond due to the ongoing extradition trial at Westminster Magistrates’ Court in London, which is now set for a hearing on July 11.
Meanwhile, Mallya remains on a 650,000-pound bail bond since his arrest on an extradition warrant by Scotland Yard in April last year.
The Crown Prosecution Service (CPS), representing the Indian government, has claimed that the evidence they have presented confirms “dishonesty” on the part of the businessman, who acquired the loans through misrepresentation and had no intentions of repaying them.
Mallya’s defence team has been deposing a series of expert witnesses to try and establish that the default by Kingfisher Airlines was the result of business failure within a wider context of a global financial crisis and that its owner had no “fraudulent” intentions.