India Abroad

UK Court Grants Vijay Mallya Hike In 'Weekly Allowance', Can Now Spend Rs 16 Lakh A Week

DIVYIA ASTHANA | 1
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| February 14 , 2018 , 12:35 IST

Despite a freeze order on the global assets of 'King of Good Times' Vijay Mallya, he continues to live a good life abroad, as the London High Court recently increased his weekly living allowance from £5,000 (Rs 4.5 lakh) to £18,325 (Rs 16 lakh). The 'weekly allowance' of Mallya, is equivalent to the average annual salary of a British school leaver.

Sarosh Zaiwalla, senior partner at Zaiwalla & Co. LLP London who has acted for the Indian high commission in London in the past defended the increased allowance.

"If he is used to a luxury lifestyle then the court will not suddenly make him live on £200 (Rs 17,000) a week,” said Zaiwalla

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"He is entitled to legal expenses on top. The judge considers his style of living to reach a fair result," Zaiwalla added.

Vijay Mallya, whose bust Kingfisher Airlines recently lost a $90 million court case against Singapore’s BOC Aviation, has applied to have the freeze order against his global assets lifted and the judgement of the Debt Recovery Tribunal (DRT) in Bengaluru dated January 19, 2017, set aside.

The DRT judgement, registered by a consortium of 13 Indian banks states that he owes Rs 9,853 crore, including interest, to the banks as of November 22, 2017, for which the freeze order is an interim measure.

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The banks registered the DRT judgement successfully with English Courts Last November under the Foreign Judgments (Reciprocal Enforcement) Act of 1933.

"There is a reciprocal agreement between India and the UK so if the claimant wins, then the judge will automatically enforce the judgment against the assets frozen. They would either give the assets to the banks or sell them and give the proceeds to the banks. If the claimant fails, then the freezing order will be discharged,” Zaiwalla said.

While the Indian government is still trying to extradite Mallya who left for Britain in March 2016, efforts so far have been largely unsuccessful.

"The Indian government has made a mistake by trying to extradite him. The freezing order is better as the matter is more likely to get settled. If the Indian government gets him back to India and he declares himself bankrupt nothing will happen — except he could go to jail. At least with the freezing of his assets there is the possibility of an amicable settlement. Extradition was not the correct step and was done for political reasons," said Zaiwalla.