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Indian banks win Rs10,000 cr lawsuit against Mallya in UK

10 May 2018

Significantly, the judge also refused to overturn a worldwide order freezing Mallya's assets and upheld a Karnataka debt tribunal's ruling that a consortium of 13 Indian banks were entitled to recover funds amounting to almost Rs 10,404 crore from the businessman.

The court also recognised there was a risk of Mallya dissipating his assets by citing examples of how he transferred $40 million to his children's trust in 2016 and passed an order to freeze his assets.

The claim relates to a judgment of the debt recovery tribunal in Karnataka, which concluded that Mallya was "liable" to pay the banks a sum of INR 62,033,503,879.42 plus interest. Now out on bail, he has been absconding in England since March 2016 and refuses to come back to India over fears of an unfair trial.

The banks can now enforce the Indian judgment and sell the businessman's assets in England and Wales to recover crores in dues. However, the former liquor baron who has been residing the United Kingdom since March 2016, has consistently refused to return, arguing that the "media frenzy and hysteria" surrounding his case will deny him the opportunity for a fair trial.

"There is a risk of the value of Dr Mallya's assets deteriorating, and, or, being subject to claims by other creditors, and a risk of Dr Mallya being declared bankrupt", Henshaw wrote. These comprise three yachts, numerous cars and the Mabula Game Reserve in South Africa.

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Mallya could also seek permission to appeal against the high court decision in the court of appeal. He was also refused to appeal for Tuesday's ruling by the London High Court judge. "There are provisions for his weekly allowance, within which he can meet his needs", he added.

The UK high court judge Andrew Henshaw QC pronounced the judgement in favour of the consortium of 13 state-owned banks led by State Bank of India to whom Mallya owes more than Rs 9,000 since escaping to London in 2016.

The Crown Prosecution Service (CPS), representing the Indian government, has claimed that the evidence they have presented confirms "dishonesty" on the part of the businessman, who acquired the loans through misrepresentation and had no intentions of repaying them.

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.

Indian banks win Rs10,000 cr lawsuit against Mallya in UK