Liquor baron Vijay Mallya flees to London. Can India get him extradited?

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Liquor baron Vijay Mallya flees to London. Can India get him extradited?

After making a public plea not to treat him as a poster boy for willful defaulters of Indian banking system, the chairman of the grounded Kingfisher Airlines, Vijay Mallya seems to have fled India.

On Wednesday, 9 March Mukul Rohatgi, India's Attorney General, submitted before the Supreme Court that Mallya might have just fled Indian shores on 2 March.

On Monday, the Debt Recovery Tribunal (DRT) denied Mallya access to the $75 million, or Rs 515 crore, he is owed from Diageo.

The blocked money was part of Mallya's settlement with British liquor giant Diageo. He was pushed out as chairman of the Diageo-owned United Spirits in April 2015 after an internal probe found he had diverted funds to his United Breweries Group companies, particularly Kingfisher.

Diageo had bought a controlling stake in United Spirits from UB Group in 2014.

Also read: Vijay Mallya should have cut his coat according to his cloth. Here's why

Mallya and the money

British liquor major Diagio on Wednesday confirmed the payment of $40 million (Rs.275 crore) to Vijay Mallya as part of the $75 million (Rs.516 crore) agreement.

"We paid Mallya $40 million immediately as part of the $75-million agreement he signed with our company on February 25, with the balance ($35 million) being payable in equal instalments over five years," Diageo spokesperson Kirsty King told IANS over telephone from London

Asked about the Debt Recovery Tribunal's (DRT) 7 March order not to pay Mallya any part of the severance package till its next hearing on 28 March, King said the company was yet to receive such an order.

"We understand that the Debt Recovery Tribunal is in the process of issuing an interim order, which we will review once the full details are available," King said, adding the company was yet to receive the notice.

The DRT moved against Mallya after a complaint from State Bank of India, which heads a consortium of 17 lenders to Kingfisher Airlines.

Also read: Banks ask Supreme Court to stop Vijay Mallya from leaving India

Kingfisher Airlines stopped flying back in 2012, leaving its employees as well as creditors and suppliers in the lurch. This, because its chairman Mallya, owes more than Rs 7,000 crore to the banks.

Apart from this, Mallya faces charges from the Enforcement Directorate under the Prevention of Money Laundering Act. It's reportedly investigating him for misappropriating loans to Kingfisher Airlines.

Furthermore, Mallya is under the scanner from the CBI. Mallya's CBI investigation is for "conniving" with senior officials of IDBI Bank to secure a Rs 900-crore loan to his airline. This despite its negative credit ratings and net worth that is in violation of banking norms. Mallya was questioned by the CBI about this back in December 2015.

Courtroom drama

The proceedings before the apex court arose out of, and because of different legal fora- the Debt Recovery Tribunal at Bangalore and the Karnataka High Court declining to act with alacrity to stop Mallya in his tracks, says one of the lawyers (on condition of anonymity) representing the lenders' consortium.

Mallya owes over Rs 7,000 crore to the Indian banks.

The lenders contended that Mallya's passport should be impounded so that he is legally barred from leaving India. However, as reported earlier in Catch News, impounding Mallya's passport would have hit a constitutional hurdle.

Hence, as an alternative measure, the lenders' lawyers pleaded that the Supreme Court direct Mallya to deposit his passport in its custody. This, so that he can venture out of the country only after getting the permission from the court.

But, at the end of today's hearing, the court declined to take such a step. Instead, it issued notice to UBHL and Mallya. Both of them have to tender a reply by 30 March.

Also read: Full text: Read what Vijay Mallya has to say after resigning from United Spirits

The SC directed that Mallya be served the notice on his official Rajya Sabha Email address (since he is physically untraceable in India). Whether he will respond or not is anyone's guess.

If he has truly fled India, how would the government get him back? If he has taken refuge in a country which doesn't have an extradition treaty with India, would the government be able to bring him to book? Most importantantly, if the proceeds from auctioning off his assets don't recover even a fraction of the mammoth debts he has run up over the years, what could be an effectively and positive step forward?

India's extradition record

India's record of getting back fugitives from Britain has been patchy. For instance, Bollywood's music-director Nadeem, who allegedly had a hand in getting music moghul Gulshan Kumar assassinated in Bombay, still enjoys a safe sanctuary in London.

Another such example is former commissioner of the Indian Premier League, Lalit Modi, who fled to London after the Enforcement Directorate initiated a probe against him.

Also read: SBI tags Mallya as 'wilful defaulter', demands his arrest and impounding of passport

"This is standing on an extremely dicey legal territory- a treacherous terrain", says one of the lender consortium's lawyers. "As things stand at present, the prevailing laws are insufficient to get Mallya back if he has taken shelter in a country which doesn't share an extradition treaty with India", the lawyer states.

He says that it all depends upon the Supreme Court how it would direct any further course(s) of 'legally-sanctioned' action.

One could speculate as whether the government would adopt the same means to get back terror-accused and infamous gangster Abu Salem from Portugal (with which India doesn't have an extradition treaty). Or would the present ruling dispensation display a certain degree of benevolence?

Edited by Sahil Bhalla

Saurav Datta & Neeraj Thakur