Loan defaulters must not be judged by their lifestyle: CII President

Naushad Forbes said flamboyant lifestyle is not against law. It is a moral issue

As banks continue with their efforts to recover dues worth over Rs 9,000 crore from beleaguered businessman Vijay Mallya, industry body CII's President Naushad Forbes said Thursday loan defaulters should not judged on "moral perspectives" or by their lavish lifestyle.

He, however, was quick to add that the CII strongly supports the efforts put in by banks to collect their dues from defaulters as better recovery of loans would result in a better lending cycle.

"There is a legal perspective, moral perspective and business perspective. And the only perspective that matters actually is legal perspective," he said, in an apparent reference to the Mallya case.

"Moral perspective is very often when we look at particular defaulters, we say he is living such a flamboyant lifestyle. Now flamboyant lifestyle is not against law. It is a moral issue. I may not like or approve it. I may not have dinner with that person because I don't want to spend time with someone who chooses to spend money that way. But that is his choice how to spend his money," he said.

Mallya has been known for his flamboyance and used to be referred to as 'King of Good Times' before his empire ran into troubles beginning with collapse of Kingfisher Airlines.

Mallya, who is also facing allegations of money laundering, had to resign from Rajya Sabha amid tightening of the noose by various enforcement agencies and lenders who are trying to recover over Rs 9,000 crore dues.

His passport had been revoked weeks after he flew to London on March 2.

"Business default is not against the law. The word bankrupt is not a crime. It is reflection of taking risk in business. You might go into wrong business or you might chose a wrong field. That is not illegal.

"The only issue that matters is legal issue. What law was broken in this process? That's why it is important to distinguish between wilful defaulter and defaulters. Defaulters, I think, should have sympathy and wilful defaulters should not," he explained.

Speaking about the GST Bill, he said the onus of passing the proposed law lies with the opposition.

"In terms of passing the buck, I would say the buck squarely lies presently with the opposition, because it (GST Bill) has been passed in Lok Sabha. It has been awaiting passage in the Rajya Sabha. It is clear where is blockage is," Forbes said at a press conference.

"We had a lot of engagement with the opposition. We have met different leaders from the opposition in the recent past. And they are very clear that the problems are purely political," he added.