ED attaches Mallya's assets worth Rs 6,630 cr

Liquor baron Vijay Mallya on Saturday lost more property to the Enforcement Directorate (ED), which issued orders to attach assets worth Rs 6,630 crore in a money laundering case.

This is the second attachment order by ED in three months. The agency has so far taken possession of assets worth Rs 8,000 crore owned by Mallya, who is facing charges of cheating a consortium of banks by defaulting loans worth around Rs 9,400 crore taken on behalf of Kingfisher Airlines. The fresh action came after the CBI expanded its probe to cover the whole loan default by Mallya and United Breweries (Holdings) Ltd (UBL).

On June 11, ED seized Mallya's property worth Rs 1,411 crore in connection with the first case of loan default involving IDBI Bank. The total attachment under Saturday's order is worth Rs 4,234.84 crore.

But the present market value is Rs 6,630 crore, an official statement said. "Mallya criminally conspired with Kingfisher Airlines and United Breweries (Holdings) Ltd to obtain funds through a consortium of banks. Of this, a principal amount of Rs 4,930.34 crore still remains unpaid," an official statement said. The properties attached on Saturday include Mandwa Farm House in Alibaugh, flats in Kingfisher Towers in Bengaluru, Mallya's fixed deposits with HDFC, shares of United Spirits Limited, United Breweries (Holdings) Ltd and Macdowell Holding Company held by Mallya, UBLand other entities controlled by him.

ED has claimed that Mallya remitted over Rs 3,500 crore of the loan overseas under the pretext of payments of lease rentals, repair and maintenance. Doubts arose as there were no proper lease agreements.

"Mallya created a complex web of shell or investment companies in the name of his family members/employees with dummy directors. These companies, though, do not have any business activities and no independent source of income, but hold substantial movable and immovable properties," the statement read.

Investigators also found that Mallya, while submitting a statement of his personal assets to the consortium, did not disclose in full his properties in India and overseas. A huge number of shares were also held in the name of various other group of companies controlled by him.

"Hence, it appeared that even though sufficient funds were available with the promoters of Kingfisher Airlines, they had no intention to make the payment towards the bank loans from the consortium of banks. They deliberately and intentionally kept the huge number of shares, worth around Rs 3,600 crore, pledged with UTI Investment Advisory Services Ltd and other financial institutions without substantial underlying liabilities and thus, kept the consortium in the dark," it read.

Liquor baron Vijay Mallya on Saturday lost more property to the Enforcement Directorate (ED), which issued orders to attach assets worth Rs 6,630 crore in a money laundering case.

This is the second attachment order by ED in three months. The agency has so far taken possession of assets worth Rs 8,000 crore owned by Mallya, who is facing charges of cheating a consortium of banks by defaulting loans worth around Rs 9,400 crore taken on behalf of Kingfisher Airlines. The fresh action came after the CBI expanded its probe to cover the whole loan default by Mallya and United Breweries (Holdings) Ltd (UBL).

On June 11, ED seized Mallya’s property worth Rs 1,411 crore in connection with the first case of loan default involving IDBI Bank. The total attachment under Saturday’s order is worth Rs 4,234.84 crore.

But the present market value is Rs 6,630 crore, an official statement said. "Mallya criminally conspired with Kingfisher Airlines and United Breweries (Holdings) Ltd to obtain funds through a consortium of banks. Of this, a principal amount of Rs 4,930.34 crore still remains unpaid,” an official statement said. The properties attached on Saturday include Mandwa Farm House in Alibaugh, flats in Kingfisher Towers in Bengaluru, Mallya’s fixed deposits with HDFC, shares of United Spirits Limited, United Breweries (Holdings) Ltd and Macdowell Holding Company held by Mallya, UBL and other entities controlled by him.

ED has claimed that Mallya remitted over Rs 3,500 crore of the loan overseas under the pretext of payments of lease rentals, repair and maintenance. Doubts arose as there were no proper lease agreements.

"Mallya created a complex web of shell or investment companies in the name of his family members/employees with dummy directors. These companies, though, do not have any business activities and no independent source of income, but hold substantial movable and immovable properties,” the statement read.

Investigators also found that Mallya, while submitting a statement of his personal assets to the consortium, did not disclose in full his properties in India and overseas. A huge number of shares were also held in the name of various other group of companies controlled by him.

"Hence, it appeared that even though sufficient funds were available with the promoters of Kingfisher Airlines, they had no intention to make the payment towards the bank loans from the consortium of banks. They deliberately and intentionally kept the huge number of shares, worth around Rs 3,600 crore, pledged with UTI Investment Advisory Services Ltd and other financial institutions without substantial underlying liabilities and thus, kept the consortium in the dark,” it read.