The Debt Recovery Tribunal (DRT) here on Thursday ordered attachment and recovery of tycoon Vijay Mallya's properties for defaulting on bank loans by his defunct Kingfisher Airlines Ltd.
Allowing a joint petition filed in June 2013 by a consortium of 17 banks led by the State Bank of India (SBI), the Tribunal's Bengaluru bench said properties of Mallya and Kingfisher worth Rs 6, 203 crore ($909 million) be recovered against the combined unpaid loans of Rs. 9, 091 crore, including compound interest on them.
Directing the banks to initiate the recovery proceedings, Tribunal's Presiding Officer K. Srinivasan also ordered the airline's holding companies UBHL and Kingfisher Finvest to pay an interest of 11. 5 per cent per annum on the due amount (Rs 6, 203 crore) retrospectively since the case was admitted on July 26, 2013.
"I hereby ask the banks to start the process of recovery of Rs 6, 203 crore along with interest rate at 11. 5 per cent per annum from Mallya and his companies including UBHL, Kingfisher Finvest and Kingfisher Airlines, " said Sreenivasan reading out the operative portion of the order in a packed court room.
The flamboyant 61 - year - old Mallya is reported to be in Britain since he left India on March 2, 2016 after the consortium moved the Tribunal in February last year to expedite the hearing on its debt recovery petition.
When beleaguered Mallya did not respond to the Tribunal's earlier directives, the consortium in June 2016 sought a recovery certificate from it to sell off his properties in lieu of the defaulted loans to his airline.
SBI and state - run Punjab National Bank had declared Mallya, the airline and its holding firm UBHL (United Breweries Holdings Ltd) as "wilful defaulters" in 2015.
Besides SBI, other state - run and private banks that gave loans to Kingfisher include Bank of Baroda, State Bank of Mysore, Axis Bank, Corporation Bank, Federal Bank, Indian Overseas Bank, Jammu and Kashmir Bank, IDBI Bank, Punjab National Bank, Punjab & Sind Bank, UCO Bank and United Bank of India.
"As the Tribunal has decreed banks to recover the dues from the airline and its holding company (UBHL), it is for them (banks) to decide on how they go about it, " Mallya's counsel told IANS on the condition of anonymity.
Since the loans were given against various sureties, including shares of the holding company and its assets as collateral, the banks have to assess their value to recover the amount specified by the Tribunal, hinted the counsel.
"The Tribunal's debt recovery officer will decide on the recovery process in consultation with the banks and the guarantors to the loans, " said the counsel.
Mallya and the airline, however, can appeal against the order in the Debt Recovery Appellate Tribunal at Chennai after paying 50 per cent of the due amount with interest levied.
Asked if the attachment includes properties the banks tried to sell but could not, the counsel said the debt recovery officer would decide on the list of properties.
"We are to yet to get a copy of the order.
We will go through it (order) and decide our next course of action, " added the counsel.