Indian banks back in UK court over Vijay Mallya's non-payment of debt
London: A consortium of Indian public sector banks led by State Bank of India (SBI) are back in the UK high court to seek a bankruptcy order against liquor tycoon Vijay Mallya over the alleged unpaid debt of around 1.145 billion pounds.
Judge Michael Briggs is presiding over a hearing in the insolvency division of the court in London this week in relation to a bankruptcy petition filed by the banks back in 2018 in their attempt to recoup unpaid debt accrued by the now-defunct Kingfisher Airlines.
A previous UK High Court ruling had refused to overturn a worldwide order freezing Mallya's assets and upheld an Indian court's ruling that the consortium of 13 Indian banks were entitled to recover funds amounting to nearly 1.145 billion pounds.
The banks then launched efforts to recover dues as part of the freezing order, with the bankruptcy petition aimed at seizing UK-based Mallya's assets to recover the dues.
Besides SBI, the 13 Indian banks include Bank of Baroda, Corporation bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu & Kashmir Bank, Punjab & Sind Bank, Punjab National Bank, State Bank of Mysore, UCO Bank, United Bank of India and JM Financial Asset Reconstruction Co. Pvt Ltd.
They have secured follow-on High Court orders to recover some of the funds owed to them as a result of Kingfisher Airlines' unpaid loans.
In July, the banks had won a High Court battle to access documents they were after to establish the true ownership of assets they believed were linked with the embattled liquor tycoon.
Frankly, the answer needs to be known as to which assets are that of Mr Mallya, both for the purpose of the worldwide freezing order and enforcement of the judgment, Justice Robin Knowles had ruled.
Two superyachts, a game reserve in South Africa, numerous undeclared high-value and vintage cars, valuable paintings and a piano previously owned by famous British singer-songwriter Elton John were among some of the assets on their target list.
The true ownership of a plush home overlooking Regent's Park in the heart of London also remains in contention.
Mallya's legal team has argued that the petition for bankruptcy in the UK should be dismissed because the banks are pursuing the same debt through the Indian courts.
The lawyers have also sought a stay on proceedings until Mallya's appeal against his extradition order, scheduled in the Royal Courts of Justice in London, is heard in February next year.
Meanwhile, Mallya remains on bail pending the appeal hearing in the extradition proceedings brought by India in relation to charges of fraud and money laundering amounting to an alleged Rs 9,000 crores.
He had been arrested on an extradition warrant back in April 2017 and has been fighting his extradition in the UK courts since then.
Let the Truth be known. If you read VB and like VB, please be a VB Supporter and Help us deliver the Truth to one and all.
AI, IndiGo, SpiceJet seek ATF price relief; say airline industry on verge of 'stopping operations'
Mumbai (PTI): Air India, IndiGo and SpiceJet have told the government that the country's airline industry is under extreme stress and on the verge of "stopping operations", as they sought revision in ATF pricing and financial support.
The West Asia turmoil has pushed up oil prices, and airspace restrictions have increased airlines' operating costs, especially on long-haul routes. Aviation Turbine Fuel (ATF) accounts for around 40 per cent of a carrier's operational expenses.
Against this backdrop, the Federation of Indian Airlines (FIA) has written to the civil aviation ministry, seeking steps to extend the same fuel pricing mechanism uniformly across both domestic and international operations as was done in the past with the establishment of the crack band.
ALSO READ: Tharoor junks Rijiju's claim that he agreed Cong is 'anti-women'; hails his party
With an unprecedented rise in jet fuel prices and exorbitant crack/differential between crude and ATF, the federation said the operation of airlines is being challenged in totality.
"... any ad hoc pricing (domestic vs international) and/or irrational increase in the price of ATF will result in unsurmountable losses for airlines and will lead to grounding of aircraft, resulting in cancellation of flights," the federation, which represents Air India, IndiGo and SpiceJet, said.
"In order to survive, sustain and continue operation, we request your urgent intervention for immediate and meaningful financial support to tide over the current situation," it said in a letter on April 26.
Also, the airlines have sought temporary deferment of excise duty on ATF, which is at 11 per cent.
"With the abnormal increase in ATF prices from the pre-crisis period, adding rupee depreciation to the increased prices, the 11 per cent excise duty also increases manifold for the airlines and adds to the ATF price as a big impact on airlines," they said.
Last month, the government limited the hike in ATF price to Rs 15 per litre for domestic operations, but for international operations, the price rose by Rs 73 per litre.
The airlines said the situation has practically made international operations, along with domestic operations, completely unviable and resulted in significant losses for the aviation sector in April.
Seeking urgent intervention on the current ATF ad hoc pricing, FIA said the current situation is creating a severe imbalance in domestic and international operations and rendering airline networks unviable and unsustainable.
"The airline industry in India is under extreme stress and is on the verge of closing down or of stopping its operations."
The federation has pitched for a transparent pricing framework under the crack band mechanism (USD 12–22/BBL) that was implemented in October 2022, saying there was a fair and reasonable margin for Oil Marketing Companies (OMCs).
According to FIA, the country's largest aviation hub Delhi has the second-highest value-added tax (VAT) of 25 per cent on jet fuel, while the highest rate is 29 per cent levied in Tamil Nadu.
"The other major aviation cities, viz. Mumbai, Bangalore, Hyderabad, and Kolkata range between 16 per cent and 20 per cent. These 6 cities cover more than 50 per cent of airlines' operations within India," the federation said.
