Double whammy for Vijay Mallya: ED files case, DRT blocks $75 million in Diageo deal

March 8, 2016

Mumbai/New Delhi/Bengaluru, Mar 8: In a double blow to beleaguered business tycoon Vijay Mallya on Monday, the Enforcement Directorate (ED) in Mumbai lodged a money laundering case and the Debt Recovery Tribunal (DRT) in Bengaluru barred British liquor giant Diageo from paying him anything till a case against him was disposed off.

vijaymallyaThe tribunal barred Diageo plc from paying Rs 5.04 billion ($75 million) as a severance package to Mallya who quit the chairmanship of its Indian company, United Spirits Ltd. last month, till the pending case against the liquor baron before it is decided.

"The presiding officer of DRT (R. Benkanahalli) ordered temporary attachment of the severance package amount and directed Diageo not to pay it till our case is finally heard and disposed of," counsel for State Bank of India (SBI) told media persons in Bengaluru.

Reading out the one-page order, Benkanahalli said Mallya shall not temporarily draw the $75 million mentioned in the interlocutory application till the case`s disposal.

"Diageo plc and United Spirits Ltd shall not disburse the amount ($75 million) to Mallya or his nominees or agents till the disposal of the bank`s original application (OA). Amount as sought by the applicant banks stands attached," the order said.

The tribunal also directed all defendants to furnish details of the agreement on or before the next date of hearing (March 28), when it will hear the bank`s three other interlocutory applications, seeking his arrest, impounding of his passport and seizure of his assets.

It also ordered issuing notice on the bank`s application to Diageo office in London through registered post.

A consortium of 17 state-run and private banks led by SBI filed the application on February 26, a day after Diageo signed the deal with Mallya for resigning as chairman and not competing with it in the spirits business worldwide for the next five years for $40 million this year and the balance ($35 million) over the next four years.

According to the SBI counsel, Mallya`s now defunct Kingfisher Airline owes the consortium a whopping Rs.10,000 crore, including compound interest over the remaining combined loans of Rs.7,800 crore borrowed between 2004-12 before it was grounded and shut down subsequently.

In another major blow for Mallya, the ED on Monday registered a money-laundering case against him.

"We have filed a case against Mallya on Monday. The case is specifically based on the case registered by the CBI against him and others in (October) 2015," Assistant Director (Enforcement Directorate) A.K. Rawal said in New Delhi.

Mallya and the top executives of the erstwhile KFA have been booked under Sections 3 and 4 of the Prevention of Money Laundering Act (PMLA), Rawal said.

The measure follows an audit of the Rs 7,200 crore loan that the bank consortium had extended to the airline but was not repaid.

The KFA is alleged to have diverted as much as Rs.4,000 crore of that money to international tax havens like Mauritius and Cayman Islands, which is being probed by the ED and the Central Bureau of Investigation (CBI).

Other businesses of Mallya were also being scrutinized by the ED under the PMLA, an official, requesting anonymity, told IANS in Mumbai.

It is feared that Mallya might become a fugitive from law by shifting base to a country where it might be difficult to make him face the Indian laws, officials said.

The flamboyant businessman, who recently announced his plans to spend more time with his family in Britain, has refuted all charges against him and taken exception to being labelled as a "wilful defaulter" by some of the lender banks.

Mallya has also denied he was planning to flee the country and said he was ready to cooperate with the lenders and the agencies to settle the debt.

Though the consortium of lenders moved the tribunal in 2013 for recovery of their outstanding loans, Mallya`s dramatic announcement that he would move to London forced the banks to lay first claim on the deal amount and rush to the tribunal for early hearing of its case.

Perceived as the `King of Good Times`, Mallya was recently in the news when some former airlineemployees wrote an open letter, blaming him for the grounding of the airline and damaging the country`s reputation in the aviation industry.

Once reputed as the most glamorous and luxurious private airline in the country, KFA fell into bad days and was grounded in October 2012 after a huge financial mess, including default of bank loans, dues to oil companies, airports and even staff salaries.

Comments

Rikaz
 - 
Tuesday, 8 Mar 2016

No matter what, he should not have stopped paying for his employees...it is their curse...that brought him to this stage....

karan
 - 
Tuesday, 8 Mar 2016

this same SBI bank and other bank need all the document and everything if poor guy have they will not provide even 20,000 of loan, and here mally did wonderful job, dont pay even one rupee to them all this bank eaten poor people's money.

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News Network
March 3,2020

Chennai, Mar 3: The Madras High Court has ruled that if a working woman gives birth to a child in the second delivery after twins in the first, she is not entitled to maternity benefits as it should be treated as third child.

"As per existing rules, a woman can avail such benefits only for her first two deliveries. Even otherwise it is debatable as to whether the delivery is not a second delivery but a third one, in as much as ordinarily when twins are born they are delivered one after another, and their age and their inter-se elderly status is also determined by virtue of the gap of time between their arrivals, which amounts to two deliveries and not one simultaneous act," the court said.

The first bench, comprising Chief Justice A P Sahi and Justice Subramonium Prasad stated this while allowing the appeal from Ministry of Home Affairs.

It set aside the order June 18 2019 order of a single Judge, who extended 180 days of maternity leave and other benefits to a woman member of the Central Industrial Security Force (CISF) under the rules governing the Tamil Nadu government servants.

The issue pertains to an appeal moved by the ministry, which contended that the leave claim is by a member of CISF to whom the maternity rules of Tamil Nadu would not apply.

She would be covered by the maternity benefits as provided under the Central Civil Services (Leave) Rules, the ministry said.

When the appeal came up for hearing, the bench said it found that a second delivery, which, in the present case, resulted in a third child, cannot be interpreted so as to add to the mathematical precision that is defined in the rules.

The admissibility of benefits would be limited if the claimant has not more than two children, the bench said "This fact therefore changes the entire nature of the relief which is sought for by the woman petitioner, which aspect has been completely overlooked by the single judge", the bench said.

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Agencies
July 21,2020

New Delhi, Jul 21: Air India trade unions have complained to Civil Aviation Minister Hardeep Puri that the government has now turned a blind eye to the management's ethnic cleansing at lower levels through compulsory leave without pay (LWP), redundancies and wage cuts.

In a letter to Puri, the Joint Action Forum of Air India unions said, "We are deeply ashamed to say that it seems that after praising our Air Indian Corona Warriors at grand functions, respectfully, the government has now turned a blind eye to this management's ethnic cleansing of Air Indians at the lower levels, through compulsory LWP, redundancies and wage cuts."

The Joint Action Forum of Air India unions strongly opposes this Compulsory Leave without pay scheme as it is an illegal practice and is not a voluntary scheme.

"In fact the Board resolution itself empowers the Chairman and Managing Director with extraordinary powers, which seem akin to a High Court, to pack off employees on 2 years leave (extended to 5 years) at CMD's discretion or at the arbitrary whim of the Regional heads," the trade unions said.

"This said Compulsory LWP scheme violates every labour law put in place by Parliament and orders of the Supreme Court and various other courts and seeks to dispossess the lower categories workers of their legally guaranteed rights," it added.

The trade unions have pointed out that the redundancies are at the elite management cadre level and not the workers.

"We are indeed shocked that the management of Air India could prepare and formulate a scheme for compulsorily sending workers on leave without pay, which is akin to an illegal lay-off, under the garb of a Leave Without Pay, when ironically the redundancy actually lies in the upper echelons of management and not with the humble workers of Air India, who have slogged to make our Airline the treasure it is," they complained to Puri.

"It must be noted that out of 11,000 permanent employees, our management occupies almost 25% as Executive Cadre, with little or no accountability. Solely amongst the Elite Management Cadre, we have 121 top officers ranking from DGMS, GMs, EDs to Functional Directors, most of whom are either performing duplicate job functions or are indeed redundant and not to mention the retired relics serving as consultants and also the CEOs of various subsidiary companies," they added.

Trade unions said the redundancy or compulsory leave without pay scheme if any at all, has to apply only to these Executives, more so, when they do not even have protection of labour laws or Supreme Court orders.

Strangely, the topmost corporate executive cadre and the backroom Generals, have saved themselves from the axe of wage cuts, by sacrificing a piffling of a few grand, whilst the frontline warriors of flying cabin crew, engineers, ground staff have borne the biggest brunt head on, the unions said.

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Agencies
July 23,2020

Expressing concern over the ban imposed on TikTok by the government of India, Facebook CEO Mark Zuckerberg has reportedly called the development in the south Asian country “worrisome”.

TikTok was amongst the 59 Chinese apps that were banned in India but why it hogs the maximum limelight because TikTok had the second-largest user base in India with over 200 million users.

As per The Verge writer Casey Newton, Zuckerberg was worried about TikTok’s India ban. Although it soon cashed into the opportunity and released a TikTok clone “Reels”, the government’s reason behind banning the app in India wasn’t received well by Mark Zuckerberg. 

He had said that if India can ban a platform with over 200 million users in India without citing concrete reasons, it can also ban Facebook if something goes amiss on the security and privacy front.

Why Mark finds it particularly worrisome because Facebook is already involved in a lot tussle with the governments across the world involving national security concerns. 

“Facebook already faces fights around the world from governments on both the left and the right related to issues that fit under the broad umbrella of national security: election interference, influence campaigns, hate speech, and even just plain-old democratic speech. Zuckerberg knows that the leap from banning TikTok on national security grounds to banning Facebook on national security grounds is more of a short hop,” the report by Casey read.

Facebook till now has not faced any kind of issue in India but considering the debacle with the other governments, it is not entirely wrong to worry about its future in India if any national security issue arises. Back in 2016, Facebook’s Free Basics service, which means a free but restricted internet service, was banned in India by the telecom regulators. 

The TRAI had said that the Free Basic services were banned in India because it violated the principles of net neutrality. With Free Basics services, Facebook had planned to bring more unconnected users online. But since 2016, there has been no major tussle between the Indian government and Zuckerberg due to national security issues.

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