EXCLUSIVE - Mallya back in F1 paddock, India a step too far

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By Alan Baldwin

SILVERSTONE, England (Reuters) - Vijay Mallya has set foot in the Formula One paddock for the first time this season but attending races outside Britain, let alone returning to India, remains a step too far for the exiled tycoon.

The Force India co-owner's diplomatic passport, which he carried as a member of the Rajya Sabha, was revoked in April with a judge in Mumbai issuing a non-bailable warrant for his arrest.

Indian authorities trying to recover about $1.4 billion from his collapsed Kingfisher Airlines want to question Mallya, who flew to Britain in March. He has had an indefinite right of residency there since 1992.

In an interview with Reuters inside his team hospitality at the British Grand Prix, Mallya made clear his reluctance to return "unless assured of a fair trial in India, if at all there needs to be a trial.

"I am willing to answer all their questions. But why only in India? And why after my passport has been revoked?" he added, saying any hearing could as easily be done in England or by video conferencing.

"For me, England is as much home."

"It's frustrating that you can't just get on a plane and go but hopefully the legal process will restore my rights sooner rather than later," added Mallya, who bought his country home from the father of world champion Lewis Hamilton.

The 60-year-old beer baron, looking slimmer than in recent times, said he was in good shape "contrary to what people may think" and was more involved with his Silverstone-based team despite being unable to travel.

"I have time to lead a far more regulated life," he said. "I have the time to focus on things that I enjoy."

PASSIONATE PETROLHEAD

Mallya has fitted out his home so he can interact with the team at races but he said that was no substitute for the buzz of being on the pit wall -- particularly at a time when the team are doing so well.

Force India have had two podium finishes with Mexican Sergio Perez and a front row start for Germany's Nico Hulkenberg in the last five grands prix.

"I am a petrolhead, passionate about Formula One. Therefore to be here, to absorb the atmosphere, to smell the fuel... it's that much more satisfying," he said.

The team ownership has been under scrutiny, with the business woes of Mallya and co-owners Sahara Group raising speculation about a possible sale to raise cash.

Sahara's founder Subrata Roy has been under arrest since March 2014 after the company failed to comply with a court order to refund money raised from millions of small investors.

"What is happening to either Mr Sahara or myself is really irrelevant to the team itself, its own stability and own operation and path forward," said Mallya.

"There is absolutely no reason why I need to sell my stake, or liquidate my stake in Formula One."

Mallya said the amount owed to banks was probably half what the media was reporting, once various amounts of interest were stripped out.

"I gave a limited personal guarantee which is in court because I have challenged the validity of the guarantee. There is no judgment on that," he said. "So the court has to decide whether my guarantee is valid and if so, for what amount."

"The media is screaming about 900 million pounds ($1.16 billion). What nobody cares to mention is that Kingfisher Airlines has launched a counter-claim on the banks themselves under lenders' liability for 380 million. Which is also being argued in court."

Sahara, which paid $100 million for the Force India shareholding in 2011, sought the Supreme Court's permission in February to dispose of it and other assets to raise a combined 53 billion Indian rupees ($789.15 million).

Mallya suggested that was a legal formality.

"Just going to court and asking for permission to sell by no means indicates that there is some sort of deal on the table," he said. "As two major shareholders, one cannot sell without the consent of another.

"I will not be able to sell without their consent... So there is nothing like that on the table at all."

($1 = 67.1612 Indian rupees)

($1 = 0.7727 pounds)