Diageo says it paid Vijay Mallya Rs 275 crore as it did not get tribunal’s order to stop the transaction

The allegations are piling up against former liquor baron Vijay Mallya, who has left the country on March 2 despite a lookout notice against him. Mallya is reportedly in his countryside home in Tiwen village in southern England's Hertfordshire. A local resident told NDTV that he saw Mallya on Wednesday at a local pub with a lady who arrived in a Black Audi car with 'Force India' written on it. He also said many people have visited Mallya's bungalow, Ladywalk', in the past few days.

The Rajya Sabha member owes around Rs 9,000 crore to 17 Indian banks, and the government is stepping up its efforts to take him to task. Here's the latest on all the problems he's embroiled in:

Diageo Plc

British liquor company Diageo Plc on Wednesday said it has paid Mallya Rs 275 crore as part of the Rs 515-crore payment they were to give him for resigning as chairman of United Spirits. Earlier, the Debt Recovery Tribunal had banned Mallya from receiving the payment, but Diageo said it did not receive the DRT’s order.

Diageo spokesperson Kirsty King told IANS, “We paid Mallya $40 million immediately as part of the $75-million agreement he signed with our company on February 25, with the balance ($35 million) being payable in equal installments over five years.”

State Bank of India, which had approached the DRT on the issue, told IANS that it was not aware Diageo had made the payment, and that Mallya’s counsel did not reveal the fact at the hearing either.

Mallya's assets

A senior finance ministry official told Economic Times that all steps will be taken to recover the money from Mallya, and if required, the government will seek to extradite him. Mallya had reportedly provided banks a list of his holdings – in 2012, after Kingfisher Airlines shut down – worth Rs 1,500 crore. Banks are hoping to claim his domestic assets first. But lawyers told Economic Times that banks cannot claim Mallya’s overseas assets without approaching courts.

IDBI bank has asked the Karnataka High Court to prevent the liquor baron from selling his equity stake in United Spirits, worth Rs 1,000 crore, to Diageo. The court will hear a plea on the matter on March 30.

Indian banks moved slowly

Officials also told Economic Times that the 17 banks to whom Mallya owes money, did not immediately move to recover their money from him. Mallya resigned from his post on February 25. On February 28, the banks were advised to approach courts immediately in a preemptive move against Mallya leaving the country. The banks finally filed a petition in the Supreme Court only on March 5, which was heard on March 9, a full week after Mallya reportedly left India.

Defaulting on crores of service tax

Other than the 17 banks that are owed money, the Bombay High Court said it will hear a plea from the Service Tax Department against Mallya and other Kingfisher Airlines officials on March 11. The department is also among those that have to recover dues worth crores of rupees from the company. It said Mallya had collected service tax on behalf of the government from passengers who travelled on Kingfisher Airlines, but never deposited the money with them. The department says Mallya owes around Rs 535 crore in service tax.

In Parliament

The matter also came up in Parliament on Thursday. The Congress gave an adjournment notice in Lok Sabha over Vijay Mallya's departure from India, and Bharatiya Janata Party MP Kirit Somaiya is expected to bring up the issue during Zero Hour. The matter was brought up in the Rajya Sabha as soon as proceedings began in the House, with Opposition leader Ghulam Nabi Azad and Congress leader Jairam Ramesh asking why the Centre had not acted on Mallya's dues earlier. Congress vice-president Rahul Gandhi also criticised the Centre for not tackling the issue earlier. Finance Minister Arun Jaitley said that Mallya was first given loans when the Congress was in power.