Bombay HC Seeks Clarity On Vijay Mallya Bank Dues, Orders SBI And ED To Respond

The Bombay High Court has sought clarification on whether Vijay Mallya’s outstanding liabilities to a consortium of banks have already been settled through funds recovered from assets attached by the Enforcement Directorate (ED).

The direction was issued after Mallya’s counsel, senior advocate Amit Desai, told the court that subsequent recovery from the attached assets had effectively settled the loans.

Justice Milind Jadhav directed the State Bank of India (SBI), which leads the consortium, and the ED to respond to the submissions and update the court on developments in the case.

Mallya challenges use of attached assets

The court was hearing a petition filed by Mallya in 2020 challenging a 2019 order of a special court. That order permitted SBI and other lenders to use movable assets attached by the ED for recovering outstanding dues.

The ED had provisionally attached Mallya’s properties in 2016 under the Prevention of Money Laundering Act (PMLA), including shares held in United Breweries Holdings Ltd.

Mallya faces allegations of money laundering and diversion of funds linked to loans extended to the now-defunct Kingfisher Airlines.

Counsel claims Rs 15,000 crore recovered

During the hearing, Desai argued that developments since the filing of the petition had rendered the matter effectively redundant. He submitted that funds generated through the attached assets had been used to repay the lenders.

According to the submission recorded by the court, the bank consortium has recovered approximately Rs 15,000 crore, compared with an original claim of around Rs 6,203 crore, including interest.

The court, however, said the claim required verification from the respondents. SBI and the ED’s deputy director have been asked to provide details regarding Mallya’s submissions and developments in the relevant Enforcement Case Information Report proceedings.

The court has also permitted Mallya to submit an additional affidavit detailing developments since his 2020 petition was filed.

The matter is scheduled to come up for further hearing on September 9.