Vijay Mallya says overseas assets are worth Rs 746 crore (but he owes Rs 9,000 crore)

LONDON: Sahara Force India coowner and former liquor baron Vijay Mallya spends £16,000 (about Rs 15 lakh) a month on maintaining his fleet of cars and his overseas assets, not including those of his wife and children, total $114 million (about Rs 746 crore), a London court has heard. Indian banks say Mallya owes them approximately Rs 9,000 crore.

Lawyers representing the Indian businessman were at the high court on Monday making an application to have the freeze on his global assets discharged and the registration of the judgment of the Debt Recovery Tribunal (DRT), Karnataka, in England set aside.

On November 24, 2017, the UK high court had registered in UK courts the January 19, 2017 DRT judgment that Mallya owed a consortium of 13 Indian banks Rs 6,203 crore plus interest and implemented a worldwide order freezing his assets up to the value of £1,145,000,000 (about Rs 10,000 crore).


The Indian banks were complaining about Mallya’s living expenses being allowed to be £18,000 (approximately Rs 17 lakh) whilst the freeze order was in force, Nicholas Peacock QC, representing Mallya, told the court. “That £18,000 is a result of the lifestyle he has from being successful and it is largely down to the £16,000 a month he pays to maintain his cars to preserve the value of their equity,” he said.

Arguing that the freeze order be discharged, Peacock said there was no solid evidence Mallya would dissipate his assets or flout court orders. “He has made extensive attempts over an extended period to settle the claims and meet the debt,” Peacock said.

He said he had made an offer of Rs 6,600 crore to the banks and disclosed his overseas assets as $114 million, and the overseas assets of his children and wife, resident in the US, to the Supreme Court in India.

“There is enough money to go round once his assets are realised, and he is willing to make it go round, but he has been frustrated by the attachment orders obtained by the Indian government institutions that have been maintained against all apparent common sense. On any view he has engaged in good faith, made sensible and commercial suggestions as a basis for negotiation. At no stage can it be said he was avoiding his obligations,” Peacock said.

He said Mallya had included the $40m (about Rs 262 crore) payout from Diageo in the disclosure of his children’s assets to the Supreme Court so it was “unfair to be accused of contempt by the Supreme Court”. His children were all US citizens so could have objected to answering an Indian court’s order, Peacock submitted.

“He accepts he received just under $40m from Diageo in February 2016 and paid that sum in three equal parts to a trust of which his three children are the beneficiaries. He did it because this was the sum payable to him in settlement of his rights against Diageo, which was a major shareholder in UB, because he was leaving the business and being bought out of the liquor market worldwide and his children were losing the right to trade on the Mallya name in the liquor business worldwide,” Peacock said. He said had this not been the case his son, Siddharth, could have started trading under the Mallya name the next day.

“He had a high-profile political career and with that comes political foes,” Peacock added.

Mallya not a fugitive, claims his lawyer

Former liquor baron Vijay Mallya is not a “fugitive from Indian justice,” his lawyer claimed at the high court in London on Monday. Nicholas Peacock QC, representing Mallya, told the court Mallya left India on March 2, 2016, to attend the World Motor Sports Council, on which he had sat for 7.5 years, “not because of applications made in India by the claimants.” “He was all along an NRI and has lived in England since 1992 and been an NRI since 1988, and has made trips to India for business and politics limited to 180 days a year since then,” he said. But Nigel Tozzi QC, representing the banks, said it was a “remarkable coincidence” that he flew to the UK the same day the banks moved the Debt Recovery Tribunal (DRT).