Supreme Court gives Mallya 4-month jail for contempt, asks him to return $40 million
NEW DELHI: The Supreme Court on Monday sentenced fugitive former liquor baron Vijay Mallya, holed up in London, to four months’ imprisonment and ordered him and his three US-based children to return $40 million, which was contemptuously siphoned out by Mallya, within four weeks with 8% interest.
More than five years after he was found guilty of contempt charges, a bench of Justices U U Lalit, S R Bhat and P S Narasimha said it was proceeding to sentence him in absentia since the contemnor (Mallya) neither showed remorse nor tendered any apology.
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“We impose a sentence of four months and fine in the sum of Rs 2,000 upon the contemnor. In case the amount of fine is not deposited within the time stipulated, the contemnor shall undergo a further sentence of two months,” the bench said. In the unlikely event of Mallya depositing Rs 2,000, the same would be given to the legal aid authority, the court said.
The bench directed the Centre, ministry of external affairs and all central agencies to comply “with due diligence and utmost urgency” the SC’s directions against Mallya, who has continued to remain in London despite final judicial extradition orders in the UK. It sought a compliance report from the government.
The SC had convicted Mallya for contempt of court on May 9, 2017 finding that he had violated court orders by surreptitiously transferring out $40 million to a trust in the US, in which his three children Siddartha, Leena, and Tanya are trustees, within days of receiving the amount from Diageo Plc on February 25, 2016, for a non-compete clause relating to the United Spirits. He wanted to put this money beyond the reach of the court, which was hearing petitions by a consortium of banks led by SBI demanding repayment of the Rs 9,000 crore loan with interest advanced to Mallya and his companies.
Ruling that a contemnor must not be allowed to reap benefits of his wrong-doing, Justice Lalit said, “The transactions of $40 million, which was disbursed to the (three children) beneficiaries, is held to be void and inoperative; Mallya and his three children shall be bound to deposit the amount received by such beneficiaries along with interest at the rate of 8% per annum with the recovery officer concerned within four weeks.”
“In case the amounts are not so deposited, the recovery officer concerned shall be entitled to take appropriate proceedings for recovery of said amounts; and Government of India and all the agencies concerned shall extend assistance and complete cooperation. It shall be open to take such appropriate steps including the appointment of forensic auditors,”the bench said.
Mallya was found in breach of orders of the Debt Recovery Tribunal, Karnataka HC and the Supreme Court. The SC had found that money had come to the United Spirit account from Diageo PLC on February 25, 2016 and it was taken out by Mallya between February 26 and 29, 2016, despite an express court prohibition against this. “Again, the accrual of this money to your account was never disclosed to the SC along with your assets as you were mandated to do,” the bench said before reserving the verdict.
