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SC declines to give relief to Mallya, Kingfisher Airlines

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HC rejects Kingfisher’s plea against move by banks
HC rejects Kingfisher’s plea against move by banks

The Supreme Court on Tuesday denied relief to debt-ridden Kingfisher Airlines challenging the decision of the Grievance Redressal Committee (GRC) of United Bank of India (UBI) to declare the airline and its promoter Vijay Mallya as wilful defaulters.

A Bench of Justices Anil R. Dave and U. U. Lalit refused to entertain the company’s petition seeking a direction to the government allowing liberty to make representation before the UBI’s grievance committee and right to a legal representative.

The airline claimed that it was declared a wilful defaulter without giving it an opportunity to be heard. It submitted, through counsel, that the defaulter order by UBI “blacklists” the company leading to serious consequences.

“Your grievance has been that Grievance Redressal Committee should not decide the matter but they have already decided it, therefore your plea is infructuous” the Bench observed.

Kingfisher’s submission

Kingfisher submitted that the committee passed the order despite being informed that it had filed an appeal in the Supreme Court against the Calcutta High Court order dismissing its plea that Mr. Mallya and the board of directors might be represented by its law officers or company secretary on a show cause notice by UBI for alleged wilful default on payment of dues of Rs.400 crore. However, Attorney General Mukul Rohatgi opposed the plea of Kingfisher saying it had been for months seeking adjournments in the High Court and allegedly indulged in diverting funds without paying salary to its employees. The Bench said since the petition here had become infructuous, Kingfisher could return to the high court and challenge the bank committee’s order.

PTI reports:

United Bank of India, on Monday, became the first lender to declare debt-ridden Kingfisher Airlines and its promoter Vijay Mallya as wilful defaulters.

Assailing the GRC order, senior advocates Abhishek Singhvi and Parag Tripathi, appearing for Kingfisher, said the bank should have waited for the outcome of the appeal before the apex court as the airline was only seeking that its promoter and directors should be allowed to be represented by their counsel.

They said the petition was, on Monday, mentioned before the bench headed by Chief Justice R. M. Lodha, which declined to give urgent hearing and listed the matter for Tuesday.

The division bench had upheld an order of single judge delivered on July 10, directing the UBI authorities to give a 72-hour notice to Kingfisher for fixing a date for the meeting.

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