India's fugitive businessman Vijay Mallya got a big setback from the London High Court on Monday. The British Court declared Mallya bankrupt. Mallya had reportedly tried appealing against the High Court verdict but was refused permission to do the same.
"As at 15.42 [UK time], I adjudicate Dr Mallya bankrupt," Chief Insolvencies and Companies Court (ICC) Judge Michael Briggs said in his ruling during a virtual hearing of the Chancery Division of the High Court.
The ruling will help the consortium of Indian banks led by the State Bank of India (SBI) to recover debt from loans given to Vijay Mallya's now-defunct Kingfisher Airlines by seizing his India assets.
In a virtual hearing before Judge Michael Briggs in the Main Bankruptcy and Companies Court (ICC), both sides gave their final arguments in the case after amending the bankruptcy petition filed last year.
It is worth noting that earlier, the consortium led by SBI had tried hard to declare the fugitive businessman bankrupt during a hearing in the London High Court in April. Vijay Mallya is owed thousands of crores of rupees on loan taken for the defunct Kingfisher Airlines.
The absconding businessman's barrister, Philip Marshall, sought a stay as well as an adjournment of the order while legal challenges remain ongoing in the Indian courts. However, the requests were turned down by the judge who concluded that there was "insufficient evidence" that the debt will be paid back to the petitioners in full within a reasonable period of time.
The petitioners were made up of SBI-led consortium of 13 Indian banks, including Bank of Baroda, Corporation bank, Federal Bank Ltd, IDBI Bank, Indian Overseas Bank, Jammu & 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 as well as an additional creditor, had been pursuing a bankruptcy order in the UK in relation to a judgment debt which stands at over GBP 1 billion.
It is worth noting that the debt in question comprises principal and interest, plus compound interest at a rate of 11.5 per cent per annum from 25 June 2013.
