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The Bangalore Bench of the Debt Recovery Tribunal (DRT) has reserved its order till March 7 on a plea from an SBI-led consortium of banks seeking a “garnishee” order against Diageo plc to refrain from any payment to Vijay Mallya, and to direct it to deposit the money with the Tribunal.
The DRT took up only one out of the four applications filed by the consortium seeking various directions against Mallya. The other three relate to the arrest of Mallya, seizure of his passport and seeking complete disclosure of his assets in India and abroad. The Bench said it will hear only one application at a time.
No gentle treatment The counsel for the consortium said Mallya should be immediately restrained from receiving the money from Diageo, which had struck a deal with him, offering him $75 million in lieu of his stepping down from subsidiary United Spirits as well as signing a non-compete agreement. Mallya is not a borrower who deserves such a gentle treatment; it is public money, he pointed out.
During the argument, the Bench wanted to know what securities the bank had received from Mallya for disbursing the loan to him.
The counsel said the total amount Mallya and his companies owe the consortium of banks has now gone up to ₹10,000 crore. He also wanted to know where Mallya is at present.
The counsel for Mallya pointed out that he is a Rajya Sabha member and he should not be shown in poor light. There are only newspaper reports that he will settle down in London after receiving the money, he added.
Earlier, the Karnataka High Court said there is no impediment for the DRT to hear the four applications filed by the SBI-led consortium. The consortium had moved the High Court complaining that the DRT had on March 2 adjourned the hearing to March 4 without passing any order on the applications, particularly on the plea for securing the lenders’ first right on the $75-million severance package from Diageo.
Justice AS Bopanna, who heard the plea, ordered issue of notices to Diageo and others, while a counsel accepted notices for Kingfisher Airlines and Mallya. The court also permitted the consortium to serve notice to Diageo through e-mails.
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