Banks cannot charge interest on money recovered, says Vijay Mallya to High Court

Fugitive industrialist Vijay Mallya on Tuesday submitted before the Karnataka High Court that banks cannot continue charging interest on amounts already recovered from him and the UB Holdings, the company that controlled the erstwhile Kingfisher Airlines.

Mallya has approached the Court seeking detailed statements of accounts from banks on the debt UBHL borrowed and the amounts that have been recovered so far.

Senior advocate Sajan Poovayya, appearing for Mallya, contested the stand taken by banks that they cannot consider the amount recovered through courts as final in view of the pendency of court proceedings. The banks, he said, have already recovered their due from Mallya and hence, banks must not levy interest on the recovered sum as they were very much using the money.

UB Holdings was the borrower for which Mallya had stood guarantee, he said and added that the recovery certificate from the debt recovery tribunal was for the recovery of Rs 6203 crore with a further interest at 11.5 %.

The enforcement directorate’s July 16, 2021, press release said the amount recovered was Rs. 7181 crore, but Rs 10,040 crore had already been recovered as per the recovery proceedings. The Finance Minister, the senior advocate said, has informed the Parliament that PSU banks have been restored with attached property of about Rs 14,000 crore.

Mallya, in a post on X, last month, said the “Indian Public Sector Banks who claim monies from me as a guarantor should be ashamed that they have not yet submitted an accurate statement of account of recoveries made despite the Union Finance Minister clearly stating that Rs 14,100 crores have been restored to the very same Banks.” He, however, added that he would not pursue legal action in England till the Indian Public Sector Banks came clean as “I have a justified counter claim that can be adjudicated only in India.”