The 62-year-old former Kingfisher Airline boss, who arrived to appear before the Westminster Magistrates' Court in London, told reporters that he had met the minister and offered to settle the issue with the banks.
"My attention has been drawn to a statement made to the media by Vijay Mallaya on having met me with an offer of settlement," Jaitley said in a Facebook blog.
"The statement is factually false in as much as it does not reflect truth. Since 2014, I have never given him any appointment to meet me and the question of his having met me does not arise," he added.
Jaitley however said Mallya had 'misused' the privilege of being a Member of Rajya Sabha as he had on one occasion "paced up to catch up with me and while walking uttered a sentence that I am making an offer of settlement” while he (Jaitley) was walking out of the House to go to his room.
Jaitley said: Having been fully briefed about his earlier “bluff offers”, without allowing him to proceed with the conversation, I curtly told him “there was no point talking to me and he must make offers to his bankers.”
I did not even receive the papers that he was holding in his hand. Besides this one sentence exchange where he misused his privilege as a Rajya Sabha Member, in order to further his commercial interest as a bank debtor, there is no question of my having ever given him an appointment to meet me," Jaitley added.