bad loan

Mallya tells SC he will pay up Rs 4,000 crore


The Supreme Court was told on Wednesday that liquor baron Vijay Mallya has offered to pay Rs.4,000 crore to settle outstanding dues against the grounded Kingfisher Airlines on account of loans extended by a consortium of 13 banks headed by the SBI.

The apex court bench of Justice Kurien Joseph and Rohinton F. Nariman was also told that Mallya has offered another Rs.2,000 crore that he expects to get if he wins his suit against multinational General Electric.

Senior counsel C.S. Vaidyanathan, appearing for Mallya and Kingfisher Airlines, said the proposal to settle the dues was made to the chief general manager of the State Bank of India on Wednesday morning.

As Mally's proposal to the SBI was given to the court in a sealed cover, Vaidyanathan urged the court to let it remain in the sealed cover -- suggesting it should not reach the media.

Vaidyanathan said: "Negotiations were going on for the settlement of the matter but unfortunately the matter reached the media."

Justice Joseph said the media had only highlighted the amount recoverable from Mallya's grounded airlines.

However, soon thereafter, senior counsel S.S. Naganand, representing the SBI-led consortium of 13 banks, spilled the beans by disclosing the details of the proposal made by Mallya.

Naganand told the court that the SBI needed a week's time to consider the proposal made by Mallya at the level of lead banks chairman Arundhati Bhattacharya and submitted that way back in 2013 the bank had filed a suit claiming Rs.6,903 crore plus interest thereon.

Accepting Naganand's plea, the court gave the consortium a week's time. It said the next hearing will be held on April 7.

On a query from the bench about Mallya's location, his counsel Vaidyanathan said he was still abroad but had held two video conferencing sessions with bank officials after the SBI filed a petition in the apex court seeking his personal appearance.

Initially, a consortium of 13 banks led by the SBI had moved the apex court seeking to restrain him from leaving the country. But by the time the petition by SBI was heard by the apex court on March 9, Mallya had left for London.

On March 9, Attorney General Mukul Rohatgi told the court that Mallya left India soon after they moved applications on March 2 before Bengaluru-based Debt Recovery Tribunal to restrain Diageo from paying him $75 million.

The consortium of 13 banks led by the SBI has challenged the Karnataka High Court's March 4 refusal to pass an interim order restraining Mallya from leaving the country and impounding his passport.

The banks are seeking the recovery of Rs.9,000 crores, saying the secured assets which Mallya pledged against the loans was not even 1/15th of the loan they had advanced to his now defunct Kingfisher Airlines.

Besides SBI, the other banks who gave loans to Kingfisher include State 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 and Sind Bank, UCO Bank and United Bank of India.

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