The Central Bureau of Investigation (CBI) has obtained a letter rogatory for an investigation into the flow of funds into Vijay Mallya’s accounts for evidence in the trial the businessman faces in two cheating and fraud cases in India. Courts of one country seek the assistance of the courts in another for the administration of justice there through letters rogatory.
The CBI has said it had reasons to believe that the loans Mallya availed from Indian banks were diverted and invested in companies based in countries like the US, UK, and Switzerland. It has called the funds lying in accounts associated with Mallya in such countries as “the proceeds of crime”.
Mallya is among those who fled India in recent years to escape prosecution including in loan default cases. He lost an appeal in Britain’s High Court in April against a 2018 decision to extradite him to India to face fraud charges linked to the collapse of his defunct company Kingfisher Airlines. Kingfisher is alleged to have taken loans with no intention of repaying them.
The CBI obtained the letter from a special court to ascertain the utilisation of funds received in an account with the American First Commerce Bank (now Pacific Premier Bank) from December 2007 to March 2009. It has sought evidence related to $ 20 million that Airbus SAS (France) had remitted in June 2008 and over $ 5 million from the State Bank of Mauritius.
The agency said loans Mallya and his now-defunct Kingfisher Airlines availed from IDBI Bank, State Bank of India, and other consortium banks had been diverted for purposes other than those avowed to the banks.
Kingfisher Airlines was incurring losses from its inception. It faced net losses of Rs 2,168 crores in the financial year that ended in March 2009. By 2009, Kingfisher had availed loans worth Rs 4,998.50 crore from various banks.
As the consortium of banks sought to recover the dues, Mallya left India for the UK. The CBI initiated a probe against Mallya, Kingfisher Airlines, and IDBI bank officials in 2015 for cheating and conspiracy to dupe banks. The Enforcement Directorate is probing money laundering charges against Mallya.