If Vijay Mallya
doesn’t fall in line within a week’s time and explain his intent to
return home and pay up banks, he will officially become a an outlaw
staying in a foreign country without valid legal documents (Mallya is
believed to be in UK now). On Friday, the Indian government suspended
his diplomatic passport for a month. Mallya has one week to respond why
his passport shouldn’t be impounded or revoked.
In other words, the next one week would decide two things. First, the fate of Vijay Mallya
as a businessman, not just in India but anywhere in the world. Second,
whether Indian banks and tax authorities will get their dues or not.
Mallya’s defunct airline, Kingfisher, owes Rs 9,000 crore to a host of
Indian banks.
The liquor baron is being investigated by
Indian agencies for alleged financial irregularities in various
transactions. Mallya left the country on 2 March shortly before banks
moved the Supreme Court seeking his detention in the country.
This
move has, in fact, complicated the Kingfisher-Vijay Mallya saga for
both sides. If Mallya fails to comply and get tagged as an absconder by
Indian government, that is the end of his career as an industrialist. No
reputed individual or corporate would cozy up with him to do business
in any country. That will be the end of Mallya as a businessman, who
grew his empire to a multi-billion business taking over from his father
Vittal Mallya. There are two possible options open before Mallya now.
A file photo of Vijay Mallya. AFP
One,
forget India and seek asylum in a foreign a country. Mallya has assets
and businesses across the world, which he can still control indirectly
and thumb his nose at the Indian government and 17-banks. Even in UK,
where human rights laws are way stronger than India, it wouldn’t be
difficult for Mallya to prove that his return is not safe to his home
country and there is no fair ground for revoking his passport by Indian
government. Mallya has the money power to employ the best legal talent
in the world to make his case.
Two, recognise the grave trouble he
is in and respond to the Indian government within a week apologising
for the delay in returning and face the law of his home land. He could
continue negotiations with the bank consortium headed by State Bank of
India and offer them a convincing roadmap to pay up the money he owes
them. The last offer to pay up Rs 4,000 crore to banks wasn’t a
convincing offer for banks since the offer revolved around too many
‘ifs’ and ‘buts’.
If one goes by how Mallya has conducted himself
so far in the loan default case, it is very unlikely that the Kingfisher
chief would ever turn up to the country and clear his name. If he ever
wanted to do so, he wouldn’t have left the country in first place and
would not have worsened the case to such an extent. The man, who once
was the poster boy of Indian aviation and ran a multi-billion business
empire, had much more than money at stake--his name as a flamboyant
businessman and that of a parliamentarian.
Mallya could have paid
up the money he owes to banks in parts. Remember, Kingfisher’s Rs 7,000
crore loans turned a non-performing asset (NPA) to banks in 2012 and was
tagged as wilful defaulter last last year, not in last month or so.
Hence, clearly, Mallya never had the intent to pay back, even when the
whole mess finally resulted in his ouster from UB group—the empire he
and his father built up over decades.
Legal experts point out
several cases in the past where Indian government has failed to bring
back absconders and criminals (Iqbal Mirchi, Nadeem Saifi and Abu
Salem). For someone like Mallya, it wouldn’t be difficult to seek asylum
using his money power. “It is too late for government to rise and wake
up,” said lawyer Majeed Memon to CNBC TV 18. “It is not that easy (in
UK), where human right laws are strong. It is a long, time consuming and
money consuming exercise that might end up in futility,” Memon said.
If
Mallya turns another Lalit Modi, the onus lies with those who let
Mallya flee the country, when investigations were on his financial
dealings and loan default. In this backdrop, several questions arise
here. Was Mallya tipped off about what is in store? Why tax, enforcement
authorities and banks delayed action for too long before they finally
woke up to realize the problem? What is preventing the taxmen and banks
to initiate process to sell off Mallya’s much valuable assets and
recover the money.
The final picture will emerge only in another
week when Mallya has been give a deadline to respond to Indian
government on passport suspension. If Mallya is opting to remain silent
and defiant, the story will be not too different from that of Lalit Modi
and others who still remain out of the reach of Indian law. This will
be highlighted as another instance that shows the inefficiency of the
state to act in time against the guilty.