It’s one gigantic farce Supreme Court is considering a petition filed by a consortium of banks to restrict the wilful defaulter Vijay Mallya from leaving India, when Individual question has already fled the country. The sensational and somewhat embarrassing reality was disclosed by Government's top lawyer Mukul Rohatgi in the court.
The disclosure raises the disturbing questions about the banking system.
A-G Mukul Rohatgi speaks out, says it's not a coincidence he fled and injects tip-off angle to saga.
NewsX spoke to AG Mukul Rohatgi. Here is a full report on the interaction:
NewsX: Do you think it's just a coincidence that a day after the CBI declared that action must be taken against Vijay Mallya, he conveniently exits India? Do you think there is the co-relation there or is it just a coincidence?
Mukul Rohatgi: I don't think it's a coincidence because there is another coincidence which I will tell you apart from CBI. After taking advice from last week the banks moved the debt recovery tribunal in Bangalore on 2nd of March and I checked from CBI. It appears that he left India in the afternoon or evening of 2nd of March.
So, two coincidences are too much to swallow.
NewsX: Do you think that he was tipped-off Sir and if he was tipped-off, do you believe that it is due to the active collusion of certain officials perhaps even in the CBI?
Mukul Rohatgi: No, I will not venture to say that. I don't have any facts to say that, but let me tell you that filing of a petition in the DRT is something which is not secret and if you have lawyers watching in different courts which is a regular practise with lots of litigants, one would know that you move the court at 10'0 clock in the morning by filing some kind of petitions and you are also suppose to sarve a copy of it from the opposite side. If that is done at 10 in the morning, then it is obvious that if one wants to take a decision, one can take a decision and can quietly leave in the afternoon or in the evening.
NewsX: Now, Mr. Mallya is reportedly to have left this country on March 2nd as you have also said. When did the government discover this, Sir?
Mukul Rohatgi: See, as far as the banks are concerned, the banks did not have any idea and were going by what was appearing on the media. But, since the case was taken up at 2 pm today, I checked with the CBI, and they told me that he had left on 2nd March. Now, I don't know when exactly they came to know because really speaking this a civil matter in which money is to be recovered. CBI is not a party in this case. I am not aware when exactly they came to know.
NewsX: Mr. Rohatgi did you enquire with the CBI whether they were watching him, observing him, all this while?
Mukul Rohatgi: No, not really. This is not a CBI case at all.
NewsX: Ok, so the FIR against Mr. Mallya was registered if I am not mistaken on 10th of October, 2015 by the CBI in the 900 crore IDBI loan scandal. Why did it take the government so long to act against this individual?
Mukul Rohatgi: No, as I told you, I am not appearing for CBI. I have no knowledge about the CBI case. I have just got knowledge about this particular bank case with which I am dealing. So, I cannot say anything more.
NewsX: Sir, there is talk that there has been money laundering with regards to these particular cases. Could you elaborate on that, Sir?
Mukul Rohatgi: No, see as I told you that I am not concerned with money laundering also. I just checked with the ED department yesterday because I had read in the paper on the day or two back that they have registered a case. So I checked with them and they said they have registered a case and they are at the initial stage of the investigation. That is what I was told by them yesterday.
NewsX: Well, sir the opposition has come out and said government is delayed to take out the steps related to the bank’s loan recovery and this has been the ticking time bomb for 3 years. How would you respond to this sir? Do you believe that the government can be held responsible?
Mukul Rohatgi: I don't think it's a case of delay. The banks moved the courts concerned in 2013 and we are in early 2016. The banks have taken possession of the Bombay property. They have forced the sale of some shares of about Rs. 500 or 1,000 crores. They are in the process of getting possession of the Goa property and stuff like that. So, it's not fair to blame them.
You know litigation in this country takes a long time and especially if you have a powerful opponent then all kinds of legalities come in the way. Banks have gone up to the high court on some of the interlocutory matters on several occasions. So, it’s not that they are sleeping over the matter. They were doing it. Maybe, they could have been a little more pro-active a few months ago, but it's unfair to say that somebody is sleeping over it or that it could’ve taken effect some years ago.
NewsX: Sir, little more pro-active you say, but why hasn't the government moved to confiscate his assets and recover the money? It’s been 3 years, Sir.
Mukul Rohatgi: See. Please understand the assets which are in India were these 2 immovable properties that indicated to you. There were certain shares which have been sold. If they were assets of the airline business, those moveable assets are not worth anything. The aircrafts were on lease and they could not be attached, so it’s not that assets in India have been left out.
What we really need is the disclosure of assets by Mr. Mallya personally as they were personal guarantees. So, those assets may be assets abroad and that is why we are asking the Supreme Court to ensure that he is available in India for our case, for the disclosure of assets and maybe also, incidentally, for the CBI investigation. That is how the progress can be made.
NewsX: Okay, you have said very interestingly in SC today that his offshore assets are said to be more than the money that has been lent to him in India? Could you elaborate on this a bit?
Mukul Rohatgi: See, we don't have full details on what is exactly owned by Mr. Mallya or his front companies there but one goes by what one reads on the media or the social media, that there are immovable properties in the UK, South Africa, Monte Carlo and US. If these are prime properties or trophy properties, as they are called, then a few thousand crores is not all that much.
NewsX: Banks and their officials go after the ‘aam aadmi’ Sir. You might not be able to pay up, or miss a couple of your EMIs and they come after you but in this case, some of the PSU bank employees have not done their due diligence. Do you think you will be going after them now, Sir, to make them accountable?
Mukul Rohatgi: See, you are right. There is this public resentment and public anger. I sympathize with the public and that fact that smaller people who take loans are made to cough up, their assets are attached, etcetera. This is a malice that is affecting our banking system. I think the Ministry of Finance, the Finance Minister, the RBI governor and the banks must all put their heads together in evolving a proper policy that more and more money should not be sunk or ‘good money’ should not be sunk after ‘bad money’. A new policy has to be evolved and maybe one can have a fresh away forward. I am sure that the investigation that is currently underway by CBI might show that there is some collusion somewhere that ought to be addressed.
NewsX: Sir, can we safely assume that Mr. Mallya has now fled the country and that this case is going the Lalit Modi way?
Mukul Rohatgi: I think it is too high or too big an assumption you are making. I don’t expect Mr. Mallya to run away. From whatever I’ve seen in the social media, he has been saying that ‘I’m not an absconder.’ ‘I will not run away.’ ‘I will settle with the banks. The banks are acting stiff.’ Or whatever. Now, the amount of the debt is not something which cannot be repaid. It is something which is achievable. I sincerely hope that Mr. Mallya comes back, sits with the bankers and sorts it out. I don’t think this case need go the Modi way, as you suggested and there is no reason to have that kind of alarm or raise huge alarms in that regard.
NewsX: He’s hypothecated UBHS shares which amount to about Rs. 5000 crores. Will you be confiscating some of those shares, Sir? Is that the way forward?
Mukul Rohatgi: A sizeable number of shares have been sold, a sizeable number of shares are locked up in dedication where amounts are lying in different course, so that is also being battle between other creditor and the banks. It’s not a very simple thing to recover. It’s not recovery of one house from an individual. A large number of companies, other creditors, banks... It’s kind of a complicated process. But there is no gain saying that the banks will leave any stone unturned for recovery of his assets. These are public funds and everything must happen for recovery. But as I tell you, the key, more than this, is a disclosure of persona assets which we have asked the Supreme Court to get us.
NewsX: What is the term that can be now used to describe Mr. Mallya in the current context? Can he be called an absconder, Sir?
Mukul Rohatgi: No, I don’t think he can be called an absconder. An absconder is somebody who is summoned by a court of law or by an agency which has the power to summon and you repeatedly evade it and run away. I don’t think it would be correct to say that.
NewsX: Sir, when will that term be used or be applicable to him? When he doesn’t show up for the next hearing? Perhaps after that?
Mukul Rohatgi: I don’t know. See, I think you media people tend to get very sensational. The Court has not asked him to appear on the next date of hearing. The Court has issued notice to him. He can appear through a lawyer. The next step would be when we ask for his personal presence and deposit of passport. If he does not come on that occasion, if the court does ask him to appear personally, that would trigger a situation where a person is keeping himself away from the arm of the law. Then, maybe, you can use the phrases that you’ve just used.
NewsX: Sir, do you believe personally that he is at flight risk? Do you believe that he is someone who could abscond?
Mukul Rohatgi: The facts, presently, which I have seen, do not warrant any such conclusion.
NewsX: Mr. Rohatgi, thank you for speaking to NewsX. I really appreciate it and I look forward to other interactions with you.
SC's 5 big rulings:
Notice to Vijay Mallya based on Bank's Petition.
Notice on why Mallya's passport shouldn't be impounded.
Mallya given 2 weeks time to respond to notice.
Notice to be issued via Indian High Commisson in UK.
Banks pulled up for granting loans in first place.