King of good times seems to have run out of good times. A UK court has ruled that judgment of Indian Courts against Mallya can be enforced against his assets in the UK.
Facts of the Case
Liquor baron Vijay Mallya fled to the United Kingdom in 2016 after defaulting on loans taken by him from various banks in India. A United Kingdom High Court dismissed Vijay Mallya’s plea to set aside the order of Indian Recovery Tribunal freezing his accounts worldwide to recover around 1.45 billion. A group of 13 banks led by India’s largest Bank State Bank of India is trying to get a hold on the liquor baron to recover their dues from him. Vijay Mallya is fighting a number of legal battles in various English Courts and it includes an extradition case to India. Westminster’s magistrate court in the UK will deliver the final verdict on extradition on 11th July.
The decision of the Case
Debt Recovery Tribunal of India had issued a freeze order against Mallya, preventing him from selling off his assets from England and Wales up to that value or to in any way dispose of, deal with or diminish the value of his assets in or outside of English jurisdiction, up to the same value. Tuesday’s verdict of commercial court (Queen’s Bench Division) strengthened it further. Partner of law firm TLT Paul Gair who represented the banks said that “Today’s judgment is a very important decision not just for our clients, who want to proceed in this jurisdiction with enforcing the judgment they secured against Mr. Mallya in India, but also for Indian and international banks more generally. Following the decision today, the banks are now considering the enforcement options available to them to recover the sums due from Mr. Mallya under the DRT judgment, which is now enforceable in England and Wales as if it were a judgment given by the English courts.” Decision was given by Judge Andrew Henshaw in favour of consortium of 13 banks which included Bank of Baroda, Corporation Bank, The Federal Bank Limited, IDBI Bank Limited, Indian Overseas Bank, Jammu & Kashmir Bank Limited, Punjab & Sind Bank, Punjab National Bank, State Bank of Mysore, UCO Bank, United Bank of India and JM Financial Asset Reconstruction Co. Pvt. Ltd. Moreover, The court also identified that there was an inherent risk of Mallya dissipating his assets by citing the example of how he transferred 40 million dollars to his children’s trust and passed an order to freeze his assets. Mallya is currently receiving an allowance of 5,000 pounds a week which was increased to 20,000 pounds this year. Vijay Mallya feels that he will not be provided a free and fair trial in India trailed by media frenzy and hysteria.
Learning of the Case
From this case, we learn that orders passed by Indian Tribunals have validity in foreign jurisdictions as if they were passed by local courts.
