Vijay Mallya withdraws application for annulment of UK bankruptcy order

Vijay Mallya, wanted in India on fraud and money laundering charges, has withdrawn his application to annul a UK bankruptcy order, allowing the court-appointed trustee to continue pursuing his assets to recover dues owed to Indian banks, according to a report by PTI.

The 69-year-old businessman, whose now-defunct Kingfisher Airlines owes around £1.05 billion to a consortium of banks led by the State Bank of India (SBI), discontinued his annulment application ahead of a scheduled High Court hearing in London on Monday.

As a result, the “Trustee in Bankruptcy” can proceed unhindered in tracing and realising Mallya’s assets to repay the lenders.

“Vijay Mallya’s Trustee in Bankruptcy will be able to continue with their work in investigating and realising assets falling within his bankruptcy estate without any hindrance that this application might have caused them,” UK law firm TLT LLP, representing the banks, said in a statement.

The move follows High Court Judge Anthony Mann’s ruling in April this year, which upheld the bankruptcy order that has been in force for more than four years. “The bottom line in relation to this is that the bankruptcy order stands,” Justice Mann had said.

Mallya had sought to annul the 2021 bankruptcy order through his lawyers Zaiwalla & Co., arguing that the banks had already recovered their dues in India. However, his team is understood to have discontinued the case after a writ petition in India—seeking details of the banks’ recoveries—failed to make progress.

The proceedings in India are seen as crucial to any future annulment plea in the UK, and sources indicate that a fresh application could be filed once the Indian case advances.

The dispute stems from a 2017 case when the Indian banks registered a Debt Recovery Tribunal (DRT) judgment in the English courts, based on Mallya’s personal guarantees for loans extended to Kingfisher Airlines. The consortium later served him with a bankruptcy petition in September 2018, leading to a bankruptcy order issued on July 26, 2021.

Separately, Mallya remains out on bail in the UK in connection with India’s extradition request. His return continues to be delayed by a “confidential legal matter” believed to involve an asylum application.

Also See: Vijay Mallya takes a dig at resolutions under IBC; points out high haircuts taken by banks