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Indian banks file for top corporate’s arrest

NEW DELHI/INDIA, 17NOV08 - Vijay Mallya, Chairman, UB Group, India, participates in a panel discussion on tourism at the World Economic Forum's India Economic Summit 2008 in New Delhi, 16-18 November 2008.  Copyright World Economic Forum (www.weforum.org)/Photo by Dana Smillie

Bangalore / AFP

A group of Indian banks has petitioned a court seeking the arrest of corporate honcho Vijay Mallya, the beleaguered businessman accused of defaulting on hundreds of millions of dollars in loans, a lawyer said.
Heavily indebted Mallya has been deep in a financial fight over his now-defunct Kingfisher Airlines, which owes more than $1 billion to a consortium of state-runbanks and creditors.
The net now appears to be tightening around the flamboyant businessman, who last month stepped down as the chairman of United Spirits, the Indian arm of Britain’s Diageo, following allegations of financial lapses.
As well as seeking Mallya’s arrest, the consortium of bankers and creditors led by the State Bank of India (SBI) is trying to lay claim to a $75 million severance payout from Diageo.
The bankers, who petitioned the High Court in the southern state of Karnataka on Friday, have also asked for Mallya’s passport to be impounded.
The court’s Justice AS Bopanna has issued a notice to Mallya seeking his response to the bankers’ petition.
“The High Court has issued notice to Mallya on our writ petition to arrest him and impound his passport for his statement to the media that he would soon be moving to Britain to live with his family,” a lawyer for the SBI said, speaking on condition of anonymity.
Mallya last month said that, having recently turned 60, he plans to move to Britain to be closer to his children.
At his height the corporate tycoon was nicknamed “India’s Richard Branson”, but his empire later began to crumble under the weight of Kingfisher’s losses.
Last year, the SBI declared the tycoon a “wilful defaulter” for not repaying loans made to Kingfisher Airlines. The airline was grounded in 2012.
Known for his lavish lifestyle, he owns a stake in the Force India Formula One team and is the chief mentor of the Bangalore team in the lucrative Indian Premier League Twenty20 competition.
Until December 2011, Kingfisher Airlines had the second largest share in India’s domestic air travel market but soon it started facing financial troubles.

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