The banks had moved the DRT in the backdrop of Mallya's recent resignation from the chairmanship of United Spirits.

news Debts Case Tuesday, March 08, 2016 - 22:12

In a move that may compound woes of liquor baron Vijay Mallya, the Supreme Court of India on Tuesday agreed to hear on Wednesday a plea of 13 banks, which had advanced loans of over Rs 9,000 crore to his firm, seeking a direction to restrain him from leaving India.

"List it for hearing tomorrow," a bench comprising Chief Justice T S Thakur and Justice U U Lalit said, when Attorney General Mukul Rohatgi, appearing for the banks, including State Bank of India, mentioned the matter for urgent hearing.

The consortium of banks, in their appeal, have assailed the March 4 order of the Karnataka High Court refusing an "ex-parte ad interim" order against Mallya, England-based Diageo Plc and United Spirits Limited.

The banks said that the High Court should have passed an interim order, securing their financial interests, without hearing the industrialist and others including debtor firm Kingfisher Airlines Limited.

"It is respectfully submitted that the same is wrong, erroneous and defeats the very purpose of filing the said writ petition. The High Court of Karnataka, at Bengaluru by its impugned order has completely failed to protect the interest of Petitioner Banks who are yet to recover an amount in excess of Rs 9,000 Crores from the Respondent Nos. 1 to 4, " the appeal said.

Prior to moving the High Court, the banks had filed four pleas in the Debt Recovery Tribunal (DRT) at Bengaluru seeking reliefs like freezing of Mallya's passport, arrest warrant against him and issuance of a "garnishee order against Respondent Nos. 10 (Diageo Plc) and 11 (United Spirits Limited) from disbursing USD 75 million".

They had also sought a direction to Mallya that he should to disclose his assets on oath.

The DRT, on March 02, heard arguments only on one plea and did not consider other three pleas which were related to freezing of the passport and restraining Mallya from leaving country, the banks said in their appeal to the apex court.

The banks had moved the DRT in the backdrop of Mallya's recent resignation from the chairmanship of United Spirits.

Diageo Plc, the current owner of the liquor company, has agreed to pay USD 75 million (approx. Rs 515 crore) to Mallya as severance package.

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