The verdict of a UK court allowing a consortium of 13 Indian banks to collect from the embattled Indian tycoon Vijay Mallya a whopping $1.55 billion to be recovered through the sale of his assets in England and Wales is a shot in the arm for Indian efforts to bring him to book for massive fraud committed in India. The speed of the UK trial is in contrast with the dilatory tactics used in litigation in India where cases take years upon years in delivery of justice. The litigation in the Queen’s Bench division of the commercial court in England’s High Court of Justice lists the State Bank of India, Bank of Baroda, Corporation Bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu &a 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 as the applicants seeking to recover their debts. In dismissing Mallya’s application to disregard the plea of Indian banks in courts, the High Court has “demonstrated its willingness to recognise judgments granted by courts in other jurisdictions, giving parties opportunities to enforce their judgments against any assets held here,” said Paul Gair, partner at TLT, a UK-based law firm that represented the 13 Indian banks, including in securing the freezing order on November 23 last year.
This case also sets a strong precedent for parties to secure a worldwide freezing order when enforcing judgments against wilful defaulters.
Mallya, who swears by the British legal system and displays contempt for Indian justice system should have no justification to look down upon the judgment which in effect emanates from Indian understanding of his liabilities. Judge Andrew Henshaw in London on Tuesday gave the green signal to the lender banks to enforce an Indian court ruling that relates to allegations that Mallya willfully defaulted on about $1.4 billion in debt for his now defunct Kingfisher Airlines. The Judge refused to overturn a worldwide order freezing Mallya’s assets.
The asset freeze order had forced Mallya to live on 5,000 pounds a week, but his allowance was increased to roughly 20,000 pounds a week earlier this year.
Mallya had been arrested after he had fled to London a year ago after things were beginning to get hot for him amid allegations of money laundering on a massive scale. The media was pursuing him leading him to charge that he was being hounded and subjected to media trial in India.
Mallya is waging another battle to stave off extradition in a different court in the UK. Attorneys at law firm TLT said the ruling will allow them to enforce the underlying judgment by the Indian debt recovery tribunal immediately.
With Parliament in India up in arms over Mallya having been allowed to flee India despite the CBI and the Enforcement Directorate investigations into his frauds at the time he moved to London, the Narendra Modi government has been relentlessly pursuing Mallya’s extradition. Prime Minister Modi has been making all-out efforts to get the Brits to have him extradited. British attorneys representing the flamboyant Mallya have been claiming in court that conditions in Tihar jail in Delhi where he is expected to be kept if extradited are appalling and since he is a British citizen, they fear that he needs to be shielded from extradition. To meet this objection, the Indian Government has assured him of basic facilities and security from attacks by fellow inmates.
With the Lok Sabha elections just a year away, the Modi government is keen to have Mallya back to face trial in India. If the extradition comes about with the removal of all hurdles, it would give a psychological boost to the BJP.