ED says no objection to banks’ request to liquidate Mallya assets

The Indian Express: February 06, 2019

Replying to an application filed by a bank consortium seeking to liquidate assets belonging to businessman Vijay Mallya, the Enforcement Directorate on Tuesday said that it does not have any objection as it is in ‘public interest’. A 12-bank consortium including State Bank of India had filed an application last month seeking the restoration of Mallya’s assets attached by the court in 2016, to get ‘best value’.

The ED in its reply filed before the special court on Tuesday said that it leaves it to the best judgment of the court to decide on the banks’ plea. It, however, said that the banks should give an undertaking from them to return the said amount in case any order is passed to that effect by the court. “In case the court deems it fit to allow the application, it shall take an undertaking from the applicants (bank consortium) to return the said amount with interest in case the court any point in time deem it fit and appropriate to deposit the said amount in the court or to the complainant (ED) without any delay,” the ED said. It said that the court has to be satisfied that the banks had suffered the loss despite taking all reasonable precautions and while acting in good faith.

Previously in 2016, settlement offers were made by Mallya showing his willingness to sell and dispose of shares, assets owned/ controlled by him and his family to settle the dues, stating that it would satisfy the repayment of the principal amount of Rs 6,203 crore owed to the banks. The banks, however, had opposed the offers claiming that they were not sufficient and on other technical grounds.

The ED had filed a case following an FIR lodged against Mallya and others on allegations of cheating, criminal conspiracy and relevant sections of the Prevention of Corruption Act, claiming that the loans taken from the consortium of banks for Kingfisher Airlines was laundered.

“It has been the argument of the accused (Kingfisher Airlines, Mallya) in the case that certain properties being amenable to market fluctuations, which are at an all-time high, require to be liquidated without delay in order to release their best value. Since the applicants (banks) … are public banks (except one), the money sought to be recovered is public money and thus restoration of assets in (their) favour, lies in public interest,” the ED has said.

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