Indian liquor baron Vijay Mallya: Photo: AFP
Indian liquor baron Vijay Mallya: Photo: AFP

A claim by fugitive Indian liquor baron and bank defaulter Vijay Mallya that he met with Finance Minister Arun Jaitley before leaving for the UK has left the minister and the National Democratic Alliance (NDA) government red-faced, with opposition parties calling for Jaitley’s resignation.

The government is trying to extradite Mallya from the UK to face trial over cases related to bank defaults in India.

While appearing in a UK court on September 12, Mallya told the media that before leaving India he met with Jaitley and told him he was leaving for London.

When he flew to the UK on March 2, 2016, Mallya was a member of the Rajya Sabha – the upper house of the Indian Parliament. He attended the Parliament one day before he left the country.

The finance minister was quick to deny any meeting took place. The liquor baron later said that while no formal meeting had taken place, he met with the minister unofficially on the Parliament premises and told him about his plans to go the UK.

He said he had also urged him to facilitate a settlement with the banks. Jaitley has not issued any denial about this unofficial meeting.

Later opposition Congress party leader Rahul Gandhi alleged that a member of Parliament from his party, P L Puniya, had seen Jaitley meeting with Mallya inside the Parliament, two days before the liquor baron left the country.

Mallya left India on the very day the banks to which he owed more than 90 billion rupees approached the Debt Recovery Tribunal. This information was later revealed by the counsels of the banks to the Supreme Court during a hearing.

In a related development, senior lawyer Dushyant Dave claimed that State Bank of India, one of the banks that approached the court about Mallya, knew of the liquor baron’s plan to escape, but did not take any action. SBI has, however, rejected his claims and said there was no laxity on its part.

The 90 billion rupee loan given by 17 state-run banks to Mallya’s failed Kingfisher airline was declared a non-performing asset in the 2011-12 fiscal year, and Mallya’s reputation as a loan defaulter had become quite well known.

This raises serious questions about Jaitley’s conduct in connection with Mallya’s flight. Also, to add to his misery, fellow party man and Rajya Sabha member Subramanian Swamy came up with another damning fact.

Swamy revealed that the lookout notice for Mallya was diluted on October 24, 2015, from “Block” to “Report” departure, which enabled the liquor baron to depart with 54 checked luggage items.

All these developments have put the NDA government’s conduct under a cloud. Since Mallya owed money to state-owned banks, it seems strange to many that the government did not take measures to prevent his departure.

The conduct of the Central Bureau of Investigation, which comes under the prime minister, has also raised some questions. Critics have said it needs to answer why it downgraded the lookout notice, thereby aiding Mallya’s escape.