The Karnataka Debt Recovery Tribunal has restrained Unit Trust of India Investment Advisory Services Ltd (UTI-IAS) and Standard Chartered Bank from handing over to Diageo PLC or any one else except the consortium of banks led by State Bank of India the 2,09,50,954 equity shares of United Breweries Ltd (UBL) pledged by industrialist Vijay Mallya and his son Siddharth.
The Tribunal passed the injunction on an application by SBI and other banks complaining that attempts were being made to transfer the shares in violation of the undertaking given to the Tribunal by Kingfisher Airlines, UBL and Mallya not to transfer, alienate or otherwise deal with them. Mallya had pledged these shares with Standard Chartered Bank. Mallya-led KAL owes ₹6203.35 crore to the consortium
In their applications, the banks alleged that despite an earlier order by the Tribunal, Standard Chartered Bank and UTI-IAS are in the process of transferring to Diageo PLC 1,04,86,666 equity shares of UBL held by Mallya and another 1,04,64,288 equity shares held jointly by Mallya and his son Siddharth.
“Diageo PLC, being one of the guarantors to the loan facilities provided by Standard Chartered Bank to Watson Ltd, has agreed to repay the entire outstanding due to the Standard Chartered Bank subject to transfer of aforementioned shares to Diageo PLC,” SBI and other banks contended, pointing out that pledging of the shares by Mallya was in itself illegal.