The special PMLA (Prevention of Money Laundering Act) Court in Mumbai passed an order on Tuesday, 1 June 2021 permitting the restoration of properties of Mallya that were seized by the Enforcement Directorate (ED) to the banks under the consortium which had provided him loans.
Mallya is an accused of bank loan default case of over Rs 9,000 crore involving his defunct Kingfisher Airlines. In 2019, the SBI-led consortium of 12 banks had submitted the application seeking ‘restoration’ of the properties attached by the Enforcement Directorate (ED) under the Prevention of Money Laundering Act (PMLA). It was alleged that the banks that had disbursed loans to Vijay Mallya and his companies had suffered losses of over Rs. 6,200 crore due to their criminal actions.
Certain real estate properties and securities belonging to fugitive liquor baron Vijay Mallya can be sold by a State Bank of India (SBI) led consortium to recover unpaid loans.
The combined value of assets comprising various floors of the UB City commercial tower in Bengaluru's central business district and stocks in United Spirits and United Breweries that Mallya had controlled are assessed to be worth Rs. 5,646 crore.
The special PMLA court in Mumbai, however, asked banks to execute a bond undertaking to return the properties if the fugitive businessman was absolved in the case or if his trial could not be concluded.
The order passed by the PMLA special court is a conditional one in which the concerned recovery officer has been directed to submit an undertaking as per provisions of Prevention of Money Laundering (Restoration of Property) Rules, 2016, the court said. It will take time to submit such an undertaking, and in the meantime, the aggrieved party may challenge the said order, and, therefore, there is no need to stay the order, the court added. The court rejected Vijay Mallya's application seeking a stay on the order.
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