JULY 15- As many as 14 banks that have lent money to Vijay Mallya’s now defunct Kingfisher Airlines Limited (KAL) have approached the Karnataka High Court seeking a stay on the disbursement of the entire amount realised from the recent sale of 13.61 crore shares of United Spirits Ltd (USL) to the British spirits major Diageo Plc by UB Holdings (UBHL), the guarantor for KAL.
The banks have to recover Rs.6,203 crore from KAL and UBHL. It has sought the court’s direction to UBHL to deposit in court the entire amount from the sale of shares.
The consortium of banks that has approached the court includes Axis Bank, Bank of India, Bank of Baroda, Corporation Bank, Federal Bank, IDBI Bank, Indian Overseas Bank, Jammu and Kashmir Bank, State Bank of India, UCO Bank, Punjab National Bank and Punjab and Sind National Bank.
On May 24, the high court had permitted UBHL to sell the shares. In turn, UBHL had assured the consortium that it will pay the dues to the banks from the sale of the shares. Appearing for the consortium, senior counsel S.S. Nagananda on Friday complained to the court that UBHL had sold the USL shares by suppressing certain facts.
He pointed out that KAL and UBHL had defaulted payments (principal amount and interest), rendering a portion of the amount lent as non-performing assets. It was reported recently that UBHL had earned Rs.3,135 crore by selling the USL shares. The banks urged the court to deposit the amount in the court until the issue was settled.
So far, the banks have recovered Rs.544 crore from March-April 2013 by selling the shares pledged by UBHL. Justice Ram Mohan Reddy, who heard the petitioners’ complaint, adjourned the hearing into the matter to July 22.
This is the second such case against KAL in the last one month. In June, three ex-pilots of KAL had approached the high court seeking closure of the ailing airlines to pay their salary dues of Rs.1.25 crore. Justice Reddy, who is hearing that petition as well, has adjourned the hearing to July 22.
