Arundhati Bhattacharya had said that SBI went after Vijay Mallya as he had given a personal guarantee for Kingfisher’s loans.
New Delhi: Fugitive industrialist Vijay Mallya owes 17 Indian banks over Rs 9,000 crore, with interest. Of this, the biggest chunk – 23 per cent – is owed to State Bank of India (SBI), the leader of the consortium of lenders that is now pursuing Mallya for default.
India’s largest public sector bank gave Mallya’s now-defunct Kingfisher Airlines approximately Rs 1,600 crore of the Rs 6,900 crore it took in loans.
Previous SBI chairperson Arundhati Bhattacharya had told ThePrint Editor-in-Chief Shekhar Gupta in March 2016 that Mallya needs to tell the bank how much he can pay and the bank will take whatever is possible. Excerpts from the conversation:
Arundhati Bhattacharya: The fact is that I do not discuss accounts. But I will here because there is so much public attention.
Probably it is not known, but we have been fighting in the debt recovery tribunal (DRT) since 2013.
In respect of this particular account. It is judicial, it has the weight of the law behind it, there is an Act. The fact of the matter is, we have done 81 hearings there (at DRT).
Not only that, in respect of the various cases that have been filed by him and me… counter-claims and things like that, there are 22 cases we are fighting here and overall there have been 508 hearings.
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The number of adjournments given is more than 180. Even in respect of one particular villa that we are trying to get possession of — the Goa villa.
The high court had passed an order saying that it should be done (possession given) in three months. The order was given to the collector – the collector, in turn, held eight hearings and then went on leave. So, in spite of the high court order, we couldn’t get the villa.
Normally, the collector is supposed to take possession (of a property) and give it to us, not have hearings. But this person had eight hearings and we are still not in possession of the villa, though we are trying very, very hard.
Even in respect of this recent matter, it is we who approached the AG (attorney general) and said that we need to really take it up to the highest level. We were told we cannot directly go to the highest court… We have to go through the DRT. So the very next day, we moved the DRT.
The DRT didn’t give us any relief, so we went to the high court the next day. The high court sent it back to the DRT. The DRT gave its order, but no relief, because our relief was only one. We needed his assets under oath, that is, he should declare what he owns because he has given (us) a personal guarantee.
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When does one go after a defaulter? It is only when a personal guarantee is given. When do we ask for a personal guarantee? We normally ask for a personal guarantee if a business has got into trouble and the promoter still wants us to advance money. At that point, the bank says, if I am going to risk something, you have to risk your skin in the game. So, that is when the personal guarantee is given.
As you know, there was trouble in the account, the account was already stressed… So, he wanted further opportunity to try and turn it around. We felt that it was right for him to get that opportunity to turn it around.
That is the reason why, you know, we went to him directly and not only to the assets of KFA (Kingfisher Airlines), because a guarantee was given by him, a guarantee was given by the holding company UBHL (United Breweries Grouo). So, we are going to go against all three for recovery. We have tried our level best to see that the money is recovered.
On why private banks managed to recover the money
We are bound by procedures because every step of ours is subject to scrutiny by the Central Vigilance Commission and the CBI. Not only that, we are also subject to the Right to Information Act.
On influential borrowers with a good phonebook
Well, I really don’t know if that play is happening. But, you tell me, we have been trying to get his assets under oath since 2013. In 2016, I am still trying for that. Why is that?
Why should I need to waste three years – time, effort, money – trying to get some resolution that should come as a matter of course? It is a fact that a loan was taken. It is a fact that there is an ability to pay. So why should it take so long?
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Message to Mallya
My message to anybody who is running into trouble with loans is this – that you should come and tell bankers upfront that these are the issues, like you would your family doctor.
Your banker should be like your family doctor. You’ve got to tell the truth. Unless you tell the truth, it is very difficult. Bankers will always try to handhold you. Just because a patient is sick, we don’t send him to the crematorium. We put them in hospital and resuscitate them. Only when no vital signs are there do we pull the plug.
That’s how public sector bankers have always been. Don’t lie, and you have to tell us exactly what the issues are so we can try and help in the manner possible.
If the situations don’t improve even after that and the business does go down, then you have to sit across from us and come to a reasonable resolution. You have to tell us how much you can pay and tell us that honestly, and we will take whatever is possible.
He needs to settle — everybody is reasonable.
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