The Enforcement Directorate on Monday filed fresh charge sheet against liquor baron Vijay Mallya and two of his firms in a money laundering case involving over Rs 6000-crore bank loans.
The ED last year had filed its first charge sheet against Mallya, now in London, in the about Rs 9 billion IDBI bank-Kingfisher Airlines (KFA) alleged bank loan fraud case.
It has attached assets worth Rs 98.90 billion in this case till now.
The charge sheet filed is due the complaint received from the State Bank of India (SBI) on behalf of the consortium of banks for causing loss of Rs 60.27 billion to them by not keeping repayment commitments of his loan taken during 2005-10, they said.
The agency has filed the charge sheet, also known as prosecution complaint, before a special court here under the provisions of the Prevention of Money Laundering Act (PMLA).
It was alleged that SBI and its consortium banks had advanced various credit facilities to Kingfisher Airlines (KFA) Limited during the period between 2005 and 2010.
During 2009-10, the company failed to meet its repayment commitments to the bank from whom it had availed credit facilities and the airlines did not keep its account with the consortium banks regular which became NPA (non performing asset), as stated in the CBI FIR later.
The consortium banks, therefore, recalled credit facilities and also invoked corporate guarantee of United Breweries Holdings Limited (UBHL) and it also alleged personal guarantee of Mallya,
It was alleged that there was a conspiracy among group companies promoter and unknown others to cheat the lenders, the CBI had said.
The ED had found that a maze of shell or dummy firms were used to allegedly siphon off these funds and this is expected to be stated in the upcoming charge sheet.
The agency, empowered by the Union government to enact the new fugitive ordinance in the country, will seek an official declaration to categorise Mallya as a "fugitive" on the basis of the cognisance of this prosecution complaint (charge sheet).
Mallya is contesting these charges in London as part of India's efforts to extradite him from there and face the legal system here in connection with these charges.
As per the existing process of law under the PMLA, the ED can confiscate assets only after trial in a case finishes which usually takes many years.
The Modi government brought the ordinance as "there have been instances of economic offenders fleeing the jurisdiction of Indian courts, anticipating the commencement, or during the pendency, of criminal proceedings," the government said.
The Fugitive Economic Offenders Bill, 2018 was introduced in the Lok Sabha on March 12 but couldnt be taken up due to logjam in Parliament over different issues.
With Parliament being adjourned sine die, an ordinance was proposed.
The Union Cabinet on April 21 approved the ordinance and the President gave his assent to promulgation of the same a day later.
The ordinance makes provisions for special courts under the Prevention of Money Laundering Act, 2002 to declare a person as a fugitive economic offender and order immediate confiscation of assets.
"A Fugitive Economic Offender is a person against whom an arrest warrant has been issued in respect of a scheduled offence and who has left India so as to avoid criminal prosecution, or being abroad, refuses to return to India to face criminal prosecution," the government said.
Cases of frauds, cheque dishonour or loan default of over Rs 1 billon would come under the ambit of this ordinance.
The ordinance offers necessary constitutional safeguards in terms of providing hearing to the person through counsel, allowing him time to file a reply, serving notice of summons to him, whether in India or abroad and appeal before the high court.
The fresh charge sheet revolves around the complaint received from State Bank of India (SBI) on behalf of the consortium of banks for causing loss of Rs 6,027 crore to them by not keeping repayment commitments of the loans taken during 2005-10, they said.