A consortium of twelve Indian banks, led by State Bank of India (SBI), has filed a petition with a Mumbai court, seeking quick release of Vijay Mallya’s assets attached by the Enforcement Directorate (ED), reports Economic Times (ET).
The joint application by the banks notes that attached assets were “amenable to market fluctuations and any delay in liquidating those assets may reduce their value.” Thus, it was necessary to undertake ‘immediate and speedy disposal of the assets to realise their best value.”
Under the provisions of the NDA Government’s Fugitive Economic Offenders Act (FEO Act), ED had moved a special court to declare Mallya as an economic offender fugitive and allow for confiscation of his assets. Following this, on 5 January 2019, absconding liquor baron Vijay Mallya became India’s first business tycoon to be declared as a fugitive economic offender.
“In the interest of economy and the banking system, which faces dire circumstances due to unrecovered NPAs (non-performing assets), rights of the banks, which are second creditors to recover their dues, would take precedence over the state’s right to attach the assets of Mallya after being declared a proclaimed offender,” the application added.
A Rs 9,000 Crore Question
Mallya has been accused of money laundering and bank-fraud cases have been filed against him by Indian authorities. Mallya is alleged to have siphoned off funds from the now defunct Kingfisher Airlines and defaulted on Rs 9,000 crore worth loans to banks. He is currently fighting an extradition case in the UK.