Mallya summoned to money laundering court

Former United Spirits owner Vijay Mallya has been ordered to appear in person before a Mumbai anti-money laundering court on 29 July.

As reported by LiveMint.com, Mallya must appear in court to avoid investigators from declaring him a proclaimed offender.

According to the Prevention of Money Laundering Act (PMLA) court judge, Mallya has absconded from the country to avoid arrest.

Mallya left India for on 2 March after signing a deal with Diageo that agreed to pay him US$75 million for stepping down as chairman of United Spirits Ltd.

He was declared a wilful defaulter by the United Bank of India and later by the State Bank of India, a label Mallya challenges.

“If he fails to appear before the court, the PMLA court will finalise the tag of proclaimed offender,” an official at the Enforcement Directorate, which investigates money laundering and foreign exchange violations, told LiveMint.com.

Mallya is due to appear at the anti-money laundering court in Mumbai at 11am on 29 July. The proclamation was issued by the court under Section 82 of the Criminal Procedure Code at the request of the Enforcement Directorate (ED).

The ED suspects Mallya of siphoning money from an IDBI Bank Ltd loan to Kingfisher Airlines and using it to buy properties abroad.

Kingfisher Airlines, which was never profitable, collapsed into bankruptcy in 2012 with debts approaching £1bn.

“We are confining our investigation to the IDBI Bank loan case. In the case of non-appearance of Mallya on 29 July, we will be able to take further steps,” the official said.

In April, Indian authorities issued an arrest warrant against Vijay Mallya days after freezing his passport. The IDBI is one of 17 Indian banks seeking to recover some $13 billion from Mallya.

Mallya, who is thought to be in the UK, rejects claims that he is a fugitive from justice. “Once a media witch hunt starts, it escalates into a raging fire where truth and facts are burnt to ashes,” he tweeted.