KFA’s IDBI loan: CBI special court adjourns case till Feb 20

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A CBI special court on Tuesday adjourned the case pertaining to the bail pleas of the nine officials arrested in connection with the alleged wilful default of the Kingfisher Airlines and IDBI Bank

loan case on Monday. The court also extended the judicial custody of the officials till February 20, when it will hear the matter.

The Central Bureau of Investigation had arrested five Former IDBI Bank officials and four Kingfisher Airlines officials on January 24. The agency had in July 2015 filed an FIR against liquor baron Vijay Mallya stating that some officials of IDBI Bank had showed undue favour to the airline in doling out a Rs 900-crore loan.

The nine accused, who are in judicial custody till February 7, are A Raghunathan former CFO of Kingfisher Airlines A Raghunathan; Yogesh Aggarwal, former IDBI chairman; IDBI executives OV Bundellu, SKV Srinivasan, RS Sridhar and BK Batra, and Kingfisher officials Shailesh Borke, AC Shah and Amit Nadkarni.

In a separate development, the Karnataka High Court ordered winding up of United Breweries Holdings, the parent company of the UB Group. The court said UBHL’s assets can be sold to recover dues payable by UBHL-promoted Kingfisher Airlines.

Back in 2012, lenders to Kingfisher Airlines had filed a case to seek dues from the now defunct airline. While BNP Paribas was the lead petitioner in the case, other petitioners include State Bank of India, a few aircraft lessors and Rolls Royce.

Vijay Mallya owns a 52.34 percent in United Breweries Holdings. The court was of the view that as UBHL was the guarantor for Kingfisher Airlines, if the UB Group isn’t in a position to repay the dues, assets of UBHL can be sold for recovery of dues.

The latest blow to Mallya comes after the Central Bureau of Investigation claimed that he might have influenced his power to get loans from banks and lenders through dubious means. “I am shocked at CBI allegations. All false and misconceived to say the least what do a bunch of elite police know about business and economics?” Mallya tweeted on February 3.

Last Thursday, documents accessed by CNN-News18 suggested how a joint secretary in the finance ministry in UPA-II had aided the ailing Kingfisher Airlines in getting loans from several banks that it may have otherwise been denied. Letters and emails exchanged showed how Amitabh Verma – a senior bureaucrat (former) in the Finance Ministry — set up meetings for Mallya with the chairpersons of various banks and get access to information that might have helped it get loans. Sources in the CBI said the agency is “looking into the larger conspiracy of this scam.”