Vijay Mallya moves court against UBI over 'defaulter' tag

KOLKATA: Kingfisher Airlines Chairman Vijay Mallya is trying to delay the process being tagged a 'willful defaulter' by United Bank of India. Such a label prevents a borrower from setting up new ventures for five years and raising money form financial institutions.

Mallya on Thursday challenged Justice Dipankar Dutta's order which dismissed his plea against the state-run lender's recovery measures and attempt to label him a willful defaulter. Mallya's appealwas heard by the Calcutta High Court division bench of Justices Pranab Kumar Chattopadhyay and Samapti Chatterjee. The next hearing is slated for July 31.

UBI is the first among the lenders' consortium to take such a stern step against the chief of the beleaguered airline. The bank had earlier served Mallya with a notice, asking him and three other directors of Kingfisher Airlines to appear before the bank's grievance redressal committee on July 9. The Kolkatabased lender has an outstanding .

Rs 350-crore exposure in the carrier, which was grounded on October 1, 2012, following a labour unrest because of nonpayment of salaries. The airliners' total dues to banks has surpassed Rs 6,400 crore.

A lender declares a person a willful defaulter when it is satisfied that the borrower does not pay despite having the ability to do so.