Standard Charted Bank (SCB) on Wednesday alleged that liquor baron Vijay Mallya, his companies and consortium of banks were in “collusion” to prevent transaction of United Spirits Ltd (USL) shares pledged to the SCB.

A Senior Counsel, appearing for SCB, made these submissions before the Debt Recovery Tribunal (DRT) during the hearing of the cases between the SBI-led consortium and the Kingfisher Airlines Ltd.

“We SCB, UTI and Diageo plc are not made party to Original Application [filed by consortium of banks]…,” the Counsel said.

“With great respect to all the Financial Institutions (FIs) they should not adopt these types of short-cut measures. It is a clear case of misleading judicial proceedings…They were fully aware of the facts that all these share transactions as they have been disclosed before the High Court in various proceedings and even here before this tribunal.

“They were fully aware that ICICI is the original lender; we (SCB) have taken over all these shares as they are pledged to us. We were the necessary parties...,” the SCB counsel argued.

Looking at all these, the Counsel contended, that now there seems to be an “understanding” between Mallya and the consortium of banks.

The consortium of banks had obtained an interim order from the DRT restraining the SCB from releasing certain shares of Mallya companies, pledged to SCB, to Diageo plc or to any other entity accept consortium of banks, the Counsel said, while pointing out that Mallya had not objected for this interim order for the reason that it would benefit him.

“These types of tactics should not be allowed in the judicial proceedings,” the Counsel claimed.

The DRT has adjourned further proceedings to Friday, when the tribunal will hear the arguments on behalf of consortium of banks.

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