Indian Banks Acting In Bad Faith: Vijay Mallya Tells London Court
Indian Banks Acting In Bad Faith: Vijay Mallya Tells London Court
States the institutions recovered more than what was due
Indian fugitive businessman Vijay Mallya's barrister, Alastair Tomson has accused the banks of acting in bad faith during the bankruptcy appeal in the Insolvency and Companies List in London, a part of the High Court of Justice’s Chancery Division.
While applying for the appeal hearing to be adjourned, Tomson told the court that Mallya's 5 February writ petition in the High Court of Karnataka could soon lead to new evidence on whether the bankruptcy order was required.
However, Judge Sir Anthony Mann dismissed the adjournment request on the spot, barring late evidence from Mallya, who alleged the banks had recovered more than what was due and misrepresented recoveries.
The judge questioned how long a case in India would take to reach its conclusion. He said, "Anecdotal evidence shows that soon in Indian courts is not necessarily soon. A lot of cases take a long time.”
Mallya, 69, was declared bankrupt by London’s insolvency court on 26 July 2021, after he failed to clear a judgment debt of £1.05 billion (Rs 11,499 crore) imposed by the Debt Recovery Tribunal, Karnataka, in 2017, registered in the English courts.
The barrister said that Mallya believed that the State Bank of India (SBI)-led consortium pursued bankruptcy proceedings against him in bad faith. They made recoveries that satisfied the judgment debt twice over, but during various proceedings, gave incorrect information.
He added that Mallya considered that the consortium concealed and misrepresented the details of recoveries and there was no accountability of the recovered assets. By suppressing facts, they took advantage of the accruing interest, unprecedented in debt recovery.
Tomson asserted, “The intent of the extortionate actions was to recover in excess of what was due to the petitioners, which was arbitrary, unlawful and unconstitutional.”
In December 2024, Finance Minister Nirmala Sitharaman stated in the Parliament that the banks had recovered Rs.14,131.6 crore from Mallya.
It led the businessman to write to the chief manager of the SBI, criticizing how the banks got a worldwide freeze order against him. He accused the SBI of ‘deception’ by realizing his assets whilst allowing interest on the judgment debt to accrue, Tomson said.
Meanwhile, representing the banks, Tony Beswetherick KC opposed the adjournment and new evidence. He said there was no evidence the Karnataka court would grant the relief.
Recently, Mallya switched law firms and instructed Zaiwalla & Co.
The Chancery Division is hearing three combined appeals.
While the banks appealed to file an amended bankruptcy petition, Mallya appealed against the bankruptcy order and the amended petition.
