The Supreme Court on Thursday agreed to examine whether attached assets of fugitive businessman Vijay Mallya’s United Breweries (Holding) Ltd. can be used to settle the debts owed to banks, including the State Bank of India.
A Bench of Justices U.U. Lalit and Vineet Saran was informed by senior advocate C.S. Vaidyanathan, appearing for the company, that firm’s assets are much more than its liabilities. UBHL has challenged the March 6 order of the Karnataka High Court, which upheld the decision of a single judge to wind up the company.
The discussion was focussed on whether the company’s properties attached by the Enforcement Directorate under the Prevention of Money Laundering Act (PMLA) can be considered to pay off the debts.
The Bench was initially inclined to issue notice on the appeal. However, Solicitor General Tushar Mehta urged the court to not do so. Mr. Mehta argued that proceedings before the courts in India are being misused by Mallya in extradition proceedings against him in the U.K.
The court reminded Mr. Mehta that he was appearing for the banks and not the government. The law officer replied that he was aware of the fact but his duty would not diminish in a matter of national interest only because he was appearing for the banks.
Mr. Mehta said the proceedings under the PMLA were completely different and that the assets attached under the provision would only be sold after the conviction of an accused.
He said the attached properties under the PMLA could not be considered for liquidation as in the event of attached properties being found to be proceeds of crime, they were liable to be confiscated and could not be used for settlement.
UBHL owes over ₹6,000 crore and compound interest to the SBI-led consortium of banks and the lenders have moved the courts and debt recovery tribunal with winding up petitions to recover their dues.
