SC holds Mallya guilty of contempt of court, orders him to appear on July 10

The order came on a plea by consortium of banks led by SBI, which had said that Mallya had allegedly transferred USD 40 million which he had received from British firm Diageo, to his children.

Published: 09th May 2017 11:07 AM  |   Last Updated: 09th May 2017 12:25 PM   |  A+A-

Force India team principal Vijay Mallya waves in the paddock during the third practice session of the Indian F1 Grand Prix at the Buddh International Circuit in Greater Noida, on the outskirts of New Delhi, October 27, 2012. | Reuters

Express News Service

NEW DELHI: The Supreme Court, on Tuesday, held Liquor baron Vijay Mallya guilty for the contempt of court, as he allegedly parted away with his property and transferred USD 40 million to his children, thereby violating of the apex court's order.

A bench of Justices AK Goel and U U Lalit held Mallya guilty on two grounds and had asked him to appear before it on July 10.

“We give him an opportunity to be present in court personally while deciding on quantum of punishment”, the Judicial bench said.

Under the law, contempt of court offence is punishable with a maximum imprisonment of six months or a fine upto Rs 2,000 or both.

"We have found respondent number 3 (Mallya) guilty of contempt of court on two grounds," added the bench.

Today’s order will also give a boost to the Centre, which is trying for Mallya's extradition from London. 

India had recently asked Britain to ensure early extradition of Mallya, who is an accused in a bank loan
default case of over Rs 9000 crore involving his defunct Kingfisher Airlines.

The hearing on this plea is likely on May 17.

Mallya owes Rs 9,200 crore to various banks and all of his properties have been attached under the anti money laundering law. 

The order came on a plea by consortium of banks led by the State Bank of India (SBI), which had said that Mallya had allegedly transferred USD 40 million received from British firm Diageo, to his children in "flagrant violation" of various judicial orders.

The banks had argued that Mallya had disobeyed the apex court's orders by making vague and unclear disclosure of his assets, along with not appearing before the court.

During the hearing, Senior counsel Shyam Divan, appearing on behalf of the banks, argued that Mallya has violated orders of the Karnataka High Court and even the Supreme Court and has attempted to put his assets beyond the reach of the court and it was wilful.

Attorney General Mukul Rohatgi, also appearing for the consortium, had contended that unless Mallya deposits USD 40 million before this court, he does not deserve to be heard and, moreover, he needed to appear personally as the contempt notice has already been issued.

Rohatgi had also told the court that the government is seeking deportation of Mallya from the UK.

Divan had referred to various orders passed by the Debt Recovery Tribunal (DRT), the High Court and the Supreme Court and said that the DRT has passed a decree in favour of the banks and the amount to be recovered is approximately Rs 9,200 crores.

There was a specific order of the High Court that Mallya will not transfer or alienate any movable and immovable assets to any person, he had said.

The apex court had on March 9 asked the liquor baron about the "truthfulness" of his disclosure of assets and the transfer of money to his children.

The bench had reserved its order on two pleas of lending banks seeking contempt action and a direction to Mallya to deposit USD 40 million received from offshore firm Diageo respectively.

The bench had also posed several queries to consortium of banks and asked it whether any criminal proceedings have been initiated against Mallya.

The court had asked Mallya as to why he did not disclose the receipt of USD 40 million from London-based company Diageo Plc and subsequent transfer of money to trusts to which his three children were the beneficiaries.

The bench had asked as to how the decree of the DRT to recover Rs 9,200 crore would be executed, to which the AG had said "God knows, how will it get the money back," adding that Mallya has taken this court for "a ride".

The bench had also asked C S Vaidyanathan, Mallya's counsel, about the response on the contempt notice.

The lawyer had said that an application for recall of the order has been filed and according to him, no contempt is made out and hence, the plea itself can be considered as the reply.

Mallya's counsel had said the money which came from Diageo belonged to his children and not him.

The bench had shot back: "Somebody who is faced with a default of Rs 6,200 crore and suppose if he gets Rs 3,000 crore, he should have given it to repay the dues".

Vaidyanathan maintained that the USD 40 million was not covered under the injunction order.

In October last year, the court had rapped Mallya for not making full disclosure of his overseas properties and had asked him to do so within a month.

The bench had also pulled up Mallya for not giving details of USD 40 million which he had allegedly received from Diageo in February last year, saying it was of the "prima facie view" that proper disclosure as per its earlier order was not made.

The banks had on August 29 last year told the Supreme Court that Mallya had deliberately not made full disclosure of his assets including the USD 40 million he received on February 25 from Diageo.

(With Inputs from PTI)

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