Mallya Promises To Pay 4,000 Crore, But maintain silence over Remaining 5,000 Crore Soon after his wipe to clear claims of 9,000 crore to a consortium of banks with a 2000 Rupee payment was rejected, now Mallya promises to pay Rs 4000 crore.
The banks has moved to the Debt Recovery Tribunal, Bengaluru and the Karnataka High Court and the company said it is fighting for their claims.
Meanwhile, the banks are making efforts to recover the amount due by evaluating Mallya properties – the Kingfisher House was recently put on auction with a reserve price of Rs 150 crore
The Enforcement Directorate is already carrying out an investigation of Mallya’s finances.
The State Bank of India alleged that funds taken by Kingfisher Airlines were used to divert to other UB Group companies and firms, in August 2014 notice sent to Mallya, Kingfisher, United Breweries, and its directors in the Bombay High Court.
Other banks that have exposure to the airline include Punjab National Bank and IDBI Bank (Rs 800 crore each), Bank of India (Rs 650 crore), Bank of Baroda (Rs 550 crore), Central Bank of India (Rs 410 crore). UCO Bank has to recover Rs 320 crore, Corporation Bank (Rs 310 crore), State Bank of Mysore, (Rs 150 crore), Indian Overseas Bank (Rs 140 crore), Federal Bank (Rs 90 crore), Punjab & Sind Bank (Rs 60 crore) and Axis Bank (Rs 50 crore).
SBI has the highest exposure of Rs 1,600 crore to the problematic Kingfisher Airlines
However, Banks are now charging 15.5% compounded interest on this principal amount, which have not been paid since January, 2013.