London: Liquor baron Vijay Mallya, wanted in India to face charges of fraud and money laundering amounting to around Rs 9,000 crore, can be regarded as a “fugitive from justice”, the UK High Court has concluded.
Judge Andrew Henshaw, who upheld a worldwide freeze order and ruled in favour of 13 Indian state-owned banks to recover funds amounting to nearly 1.145 billion pounds in a judgment yesterday, took note of the fact that the 62-year-old businessman is contesting his extradition to India relating to “alleged financial misconduct”.
“In all these circumstances, and even taking account of the fact that Dr Mallya is contesting the alleged grounds for extradition, there are grounds for regarding Dr Mallya as a fugitive from justice,” the judge said as part of his ruling.
The High Court remained unconvinced by Mallya’s claim that he has been a non-resident Indian (NRI) since 1988 and has lived in England since 1992, a country where he has indefinite leave to remain (ILR).
“The evidence indicates that prior to March 2016 Dr Mallya travelled fairly regularly between India and England for business and political reasons. Most of his business interests were in or closely connected with India, most notably United Breweries Group and Kingfisher Airlines Whilst Dr Mallya has indefinite leave to stay in the UK, he is said to be a non-resident taxpayer,” the court observed.
The judge also concluded that the businessman had been in “clear breach” of a Karnataka court’s order when he disposed of assets like a historic sword of Tipu Sultan acquired at an auction in 2003.
“The sword of Tipu Sultan is an item of historic importance which Dr Mallya bought at an auction in 2003 for the equivalent of GBP 188,400 and states that he gave away in 2016 as his family members considered that it was bringing him bad luck,” Judge Henshaw notes in his judgment.
“Dr Mallya declined to state in correspondence to whom the sword was given. Dr Mallya was unable to put forward any basis for contending that the disposal was not in breach of the Karnataka High Court’s interim injunction, and accepted that it occurred after the Supreme Court had made clear that the injunction covered subsequently acquired assets It does, though, appear to me to have been in clear breach of the Karnataka court’s order,” he adds.
The judge, however, was less certain that luxury cars and yachts had been undeclared or disposed of by Mallya as claimed by the legal team representing the 13 Indian banks State Bank of India, Bank of Baroda, Corporation bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu &a Kashmir Bank, Punjab & Sind Bank, Punjab National Bank, State Bank of Mysore, UCO Bank, United Bank of India and JM Financial Asset Reconstruction Co. Pvt Ltd.
The judge noted: “The Claimants [Indian banks] say there are numerous other assets which have been linked to Dr Mallya in various sources on the internet, but which he denies that he owns. These comprise three yachts, numerous cars and the Mabula Game Reserve in South Africa.
“The registered/asserted owners are offshore companies and/or trusts. Since these matters are unverified, I do not consider I can take account of them.”
Mallya’s purchase of a Ferrari 246 GTS with an estimated value of 480,000 pounds was also questioned by the Indian banks. The UK court concluded that it may be the case that the payment of the deposit on the Ferrari was in breach of the Karnataka High Court’s interim injunction.
“However, this point was not the subject of any detailed argument before me and, overall, I do not consider that the matters relating to the Ferrari carry matters any further on this application,” the judge concluded.
The ruling by the UK court has been described as “significant” by TLT LLP, the UK law firm which represented the Indian banks in the case.
“This is a positive and big step forward. The judgement enables our client banks to proceed with enforcement of the Indian Debt Recovery Tribunal (DRT) ruling, which has now been registered and is immediately enforceable,” said Paul Gair, partner in TLT’s Banking & Financial Services litigation team.
“We are considering all of our options with our clients the worldwide freezing order has worldwide effect, so it’s all of his assets wherever they may be. There are provisions for his weekly allowance, within which he can meet his needs,” he added.
Mallya, who remains on bail since his arrest on an extradition warrant in April last year, will return for the last leg of his ongoing extradition trial at Westminster Magistrates’ Court in London on July 11, after which the court is expected to set a timeline for judgment in that case.
The Crown Prosecution Service (CPS), representing the Indian government, has claimed it has successfully established a prima facie case of fraud against the businessman.
Mallya has claimed the criminal charges against him are “without substance” and “politically motivated”.