Spooked Vijay Mallya tells Bombay HC that confiscating his properties is draconian and will not help creditors

Fugitive Vijay Mallya on Monday told the Bombay High Court that confiscation of his properties under the newly-enacted Fugitive Economic Offenders Act (FEOA) was draconian and it would not help the creditors.

Mallya has approached the Bombay HC challenging a January 5 order of a special Prevention of Money Laundering Act (PMLA) court that declared him as a fugitive economic offender under the FEO Act.

As per provisions of the act, once a person is declared a fugitive, his properties can be confiscated by the prosecuting agency, in this case, the Enforcement Directorate (ED).

Amit Desai, Mallya’s counsel told a division bench of the Bombay High Court on Monday that the ED's confiscation of the properties will not help the creditors.

"Confiscating is draconian. The need of the hour is to deal with the banks and creditors. Mallya does not want the properties to be returned to him. We are only saying that confiscation by the government is not going to solve the problems of the banks and creditors," Desai said to PTI.

However, while opposing the petition filed by Mallya’s counsel, the ED countered that the objective of the act was to ensure the return of a person who is evading arrest by India.

"These proceedings are to ensure that these persons who commit fraud and leave the country are brought back. The moment Mallya returns to India, the provisions of this Act and the process initiated under it shall become null and void," ED said.

The petition for further hearing has been posted by the bench for April 24. However, the next hearing on the ED's application seeking permission to start confiscation proceedings has been scheduled for April 8

It was less than two months ago that the Westminster Magistrates' court had ordered the extradition of Mallya to India, with Chief Magistrate Judge Emma Arbuthnot prima facie finding a case against Mallya for fraud, conspiracy and money laundering. The order had then gone to the UK Home office for approval. 

Speaking to Republic Media Network's Editor-in-Chief Arnab Goswami in his first 2019 election interview, Prime Minister Narendra Modi had spoken about his action on fugitive economic offenders, stating that the laws enacted by his government have resulted in the seizure of Rs 14,000 crore worth of Vijay Mallya's properties against the Rs 9,000 crore in borrowings from a consortium of Indian banks on which he has wilfully defaulted.

Mallya had confirmed this:

READ | With The Swiss Also Taking India's Side, Vijay Mallya Knows He's In Serious Trouble

(With PTI inputs)