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Business News/ Companies / India asks UK to deport Vijay Mallya
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India asks UK to deport Vijay Mallya

Govt says it has written to the British High Commission seeking Vijay Mallya's return so that his presence can be secured in the money laundering case

Vijay Mallya has been accused of money laundering and is being pursued by banks for more than Rs9,000 crore in unpaid loans. Photo: Hemant Mishra/MintPremium
Vijay Mallya has been accused of money laundering and is being pursued by banks for more than Rs9,000 crore in unpaid loans. Photo: Hemant Mishra/Mint

New Delhi: India has asked the UK government to deport embattled UB Group chairman Vijay Mallya, wanted for questioning in a money-laundering probe and being pursued by creditors for over 9,000 crore in unpaid loans.

The government has written to the UK high commission in New Delhi seeking Mallya’s deportation, foreign ministry spokesman Vikas Swarup said on Thursday.

The request was made within days of a special court issuing a non-bailable warrant for the arrest of Mallya, who flew to the UK on 2 March as investigators and creditors to his grounded Kingfisher Airlines Ltd closed in on him.

“The ministry has written to the high commission of the UK in Delhi requesting the deportation of Vijay Mallya so that his presence can be secured for investigations against him under the Prevention of Money Laundering Act (PMLA) 2002," Swarup said.

“We will continue to pursue this matter with UK authorities," Swarup said, adding that the Indian high commission in London will be issuing “a similar note verbale" to the UK Foreign and Commonwealth Office.

UB Group declined to comment.

The government last week revoked Mallya’s diplomatic passport—given to him by virtue of his status as a member of the Rajya Sabha—in an effort to bring him back to India. It had suspended the passport on 15 April for four weeks on the request of the Enforcement Directorate (ED), which is probing money-laundering allegations against him.

On Monday, the ethics committee of the Rajya Sabha decided unanimously to expel Mallya from Parliament’s Upper House, and gave him a week’s time to explain his conduct in the default on bank loans in excess of 9,000 crore to Kingfisher Airlines.

Banks have been turning up the pressure on Mallya, seeking details of his assets both in India and overseas, and have won a favourable ruling from the Supreme Court. On 22 April, Mallya’s counsel told the court that banks had no right to seek details of assets held by him or his family abroad on grounds that he had been a non-resident Indian for income tax and foreign exchange purposes since 1988, while his estranged wife and three children are US citizens.

Securing Mallya’s deportation may not be easy.

“The pace at which the deportation process is initiated will depend on the UK government policy on resident visa holders with voting rights," said Mathew Antony, managing partner at Aditya Consulting, a boutique legal and business advisory firm.

“Had there been an extradition treaty between the UK and India, there would have been a laid-down process with timeliness attached to it," he said.

To be sure, the fact that Mallya does not have a valid passport is something that the UK authorities may take into account, he added.

The government is yet to weave a tight-enough case against the UB Group chairman, a legal consultant said on condition of anonymity.

“It is not clear whether Mallya has already secured another passport from any other country," he noted.

Hemindra Hazari, an independent capital market analyst and long-time watcher of the banking sector, agreed that deportation would be tough.

“The government could have easily prevented Mallya from leaving the country. After allowing him to leave, now the government is trying to deport Mallya," he said.

On Tuesday, Mallya’s counsel said in the Supreme Court that his return to India was uncertain because he was concerned that he would immediately be sent to jail. Mallya left India for the UK after he reached a sweetheart deal in late February with Diageo Plc. under which he would receive $75 million from the liquor maker in return for stepping down as non-executive chairman of United Spirits Ltd (USL).

On 7 March, the Bengaluru-based debt recovery tribunal blocked Mallya from getting his hands on the payout by Diageo, responding to an application by creditors led by State Bank of India.

The tribunal also directed London-based Diageo and its Indian unit, USL, not to disburse any money to Mallya before the case is decided. Diageo said it had already paid Mallya the first instalment due to him.

The case will he heard by the tribunal on Friday.

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Published: 28 Apr 2016, 05:07 PM IST
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