Indian banks pursue UK bankruptcy order against Vijay Mallya

A consortium of Indian banks led by State Bank of India (SBI) returned to High Court in London for a bankruptcy application hearing against liquor tycoon Vijay Mallya, as y pursue recovery of debt from loans paid out to his w-defunct Kingfisher Airlines.

At a virtual hearing before Chief Insolvencies and Companies Court (ICC) Judge Michael Briggs on Friday, both sides deposed retired Indian Supreme Court justices as expert witnesses on Indian law in support of ir arguments for and against a bankruptcy order against Mallya in UK.

While banks argued a right to waive ir security over Indian assets involved in case in order to recover ir debt in UK, lawyers for 65-year-old businessman argued that funds in question involved public money held by state-owned banks in India which precluded m from such a security waiver.

"As a commercial entity, a bank has a right to exercise its commercial wisdom to decide what it wants to do with its security,” ted barrister Marcia Shekerdemian, arguing on behalf of SBI and ors.

She cross-examined Retd Justice Deepak Verma, who deposed via video link from India on behalf of Mallya to establish that banks cant give up ir security on Indian assets and n pursue a bankruptcy order under English law because public money and public interest is involved in case in India.

Retd Justice Gopala Gowda argued reverse in his cross-examination by Mallya’s barrister Philip Marshall, saying banks h a right to relinquish ir security in pursuit of unpaid dues.

exchange between lawyers got heated at several points during course of virtual hearing, also being followed by Mallya, with Judge Briggs stepping in to urge a focussed question and answer approach to expedite proceedings.

However, depositions left time for closing submissions in case, which has w been journed to a yet-to-be-agreed date in New Year.

Meanwhile, Marshall once again raised issue of access to court-held funds from sale of a French property for Mallya to be able to cover legal fees of next hearing as he longer has a source of income from his consultancy work.

SBI led consortium of 13 Indian banks, which also includes Bank of Baroda, Corporation Bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu & 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, h initiated proceedings against Mallya in December 2018.

re have been a series of hearings in case since n as part of ir efforts to recoup around1.145 billion pounds in unpaid loans.

Mallya, meanwhile, remains on bail as UK Home Office deals with a “confidential” legal issue before UK Home Secretary Priti Patel can sign off on his extrition sought by Indian government, on charges of fraud and money laundering related to loans acquired for Kingfisher Airlines. 

(Photo Credit: AP)