Friday, September 14, 2018

Never mind who Mallya met. Why did the Modi government dilute an airport lookout notice against him?

Did debt-burdened industrialist Vijay Mallya meet Finance Minister Arun Jaitley before he fled for the United Kingdom in 2016? On Wednesday, Mallya claimed that he had spoken to Jaitley and offered to reach a settlement with the banks, to which he owed an estimated sum of Rs 9,400 crore.

Jaitley soon refuted the allegation, claiming that “the statement is factually false in as much as it does not reflect truth”. He claimed that Mallya had “misused his privilege” as a member of the Rajya Sabha and accosted him in Parliament with an offer to settle. The finance minister says that he asked Mallya to talk instead to his creditors. Mallya clarified that he had indeed met Jaitley in Parliament but added that he had also informed the minister that he was leaving for London.
The news sent India’s media and political circles into a tizzy. The Congress and a clutch of Opposition parties jumped on the incident to attack the Bharatiya Janata Party. While the optics do not look good for the ruling party, the core of the issue is not who met whom – it’s how Mallya was allowed to leave India, given the enormous burden of his loans. As it turns out, a few months before the Kingfisher Airlines owner flew up to London, the Central Bureau of Investigation had diluted a lookout notice for him.

The CBI circular, which asked the Bureau of Immigration to detain Mallya should he attempt to exit the country, had been issued on October 16, 2015. However, in a month, the Central Bureau of Investigation changed its mind. Instead, it instructed the Bureau of Immigration to simply inform the CBI if Mallya was entering or exiting India.

Within three months of this decision, Mallya resigned as chairman of United Spirits Limited, receiving a hefty payout of $75 million. At the time of resignation, Mallya had stated that he wished to go to England to spend more time with his family.

On February 26, the day on which Mallya resigned from the company, the State Bank of India – to which Mallya owes Rs 1,600 crores – moved to a debt recovery tribunal in Bengaluru, asking for his passport to be impounded. While the tribunal was hearing the matter, Mallya left the country on March 2. Thanks to the diluted Central Burea of Investigation notice, Mallya had no difficulty flying out from Delhi.
14/09/18 Shoaib Daniyal/
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