Why this ED move could hurt lenders' efforts to recover dues from Mallya

The Fugitive Economic Offenders Bill could be a thorn in their path

A consortium of Indian banks looking to liquidate Vijay Mallya's assets in Britain may face more hurdles in recovering their money. Earlier, a UK court had allowed them to search and seize properties of the fugitive liquor baron.  

But, the Enforcement Directorate may play spoilsport in their efforts, according to an Economic Times report. The report says that the agency may use the latest fugitive law to stake its claims on the businessman's money.

The May 27 Ordinance gives certain law enforcing agencies powers to attach and confiscate the proceeds of crime and properties of economic offenders like bank defaulters or bank fraudsters fleeing the country, and is aimed at deterring economic offenders from evading the process of law by remaining outside the jurisdiction of Indian courts, according to news agency IANS.

On June 21, a special court in Mumbai ordered the arrest of fugitive liquor baron Vijay Mallya for his alleged involvement in a case of money laundering and cheating a consortium of banks of over Rs 60 billion.

Special Judge M S Azmi of anti-money laundering court issued a non-bailable warrant for Mallya's arrest, taking cognisance of a fresh charge sheet filed against him and others by the Enforcement Directorate (ED).

Agenda behind recovery?

In a series of tweets almost a fortnight earlier, Mallya broke his silence on the issue. He said that he has been made the poster boy of bank default in India. Apart from that, he also wrote a letter to PM Modi. 

The 'king of good times' claimed that UBHL (United Breweries Holdings Ltd) had filed a petition with Karnataka High Court asking it to overlook sale of assets worth Rs 139 billion to pay off his creditors.

Claiming that he will continue to "make every effort, in good faith to settle with the banks", he said, "If politically motivated factors interfere, there is nothing I can do".

Force India open to offers, says Vijay Mallya

Force India's shareholders would consider serious offers for the British-based Formula One team but there are none at present, according to co-owner and principal Vijay Mallya.

The Indian businessman has a 42.5 per cent stake in the team.

His difficulties and those of co-owners Sahara Group have triggered speculation about the team's future. But Vijay Mallya insisted they had no bearing on the day-to-day running of the team.

The 62-year-old liquor baron, who fled the country on 2 March 2016, has been living in London since then despite summons from Indian courts and law enforcement agencies to appear before them for trial in various related cases.