A week after Vijay Mallya flees, Service Tax department wakes up

Seeks confiscation of his passport in a case pertaining to evasion of tax amounting to R33 crore by Kingfisher airlines in 2011; meanwhile, Vijay Mallya has left the country and is probably in the UK

The Service Tax Department yesterday moved the Bombay High Court requesting confiscation of Vijay Mallya’s passport for evasion of service tax to the tune of R33 crore. However, the move comes more than a week after the ‘wilful’ defaulter fled the country.

Vijay Mallya at a city event last month. File PicVijay Mallya at a city event last month. File Pic

Along with Mallya, the petition has made former Kingfisher Airlines CEO Sanjay Aggarwal, CFO A Raghunathan and Assistant Vice President T R Venkatadi party to the crime. The department, through its counsel Advait Sethna, told Justice CV Bhadang that a lower court had granted Mallya and Aggarwal provisional bail of Rs 50 lakh.

Kingfisher Airlines was supposed to pay Rs 79 crore as service tax from April to November 2011. While the airlines did make some ad hoc payment, it was yet to clear R33 crore which it had already collected from the fliers. A lower court heard the matter following which Mallya and Aggarwal were granted bail in December 2014. The airline had then claimed that most of the money collected as service tax was used for emergency expenses, as the airline was in financial trouble to pay for fuel to operate flight services.

“Diversion of money collected on behalf of the government for day-to-day activities of the airline amounts to an offence of criminal breach of trust and cheating,” said Sethna, adding, “We have prayed to the court to grant us permission to recover the nation’s money.” The next hearing has been scheduled for Friday.

Mallya left India on March 2: Centre tells Supreme Court
Liquor baron Vijay Mallya, who is facing legal proceedings for allegedly defaulting loans of over R9,000 crore from various banks, has left the country a week back, government yesterday informed the Supreme Court.

“I spoke to the CBI and it told me that on March 2, he (Mallya) left the country,” Attorney General (AG) Mukul Rohatgi told the bench comprising Justices Kurian Joseph and R F Nariman.

The bench issued notice to Mallya, seeking his response within two weeks on pleas filed by a consortium of banks seeking direction for freezing his passport and his presence before the apex court.

Since the court was informed that Mallya has already left the country, probably to UK, the bench allowed the plea of AG that the notice to him can be served through his official Rajya Sabha Email ID, Indian High Commission at London and also through counsel representing him before various high courts, Debt Recovery Tribunal and also through his company.

During the brief hearing, the AG said that amount of more than R9,000 crore was due to various banks and on one or the other pretext Mallya avoided to settle them.

Lookout notices issued
CBI sources claimed the agency had taken all legally-permissible precautions including issuance of lookout notices to all exit points from the country to prevent any such move on part of Rajya Sabha MP Mallya, but he still managed to escape.

They added that lookout notices are issued to alert immigration authorities to prevent any move of a person facing probe from leaving the country.

Tweet talk

@JhaSanjay: Vijay Mallya has been made the poster-boy of #HouseOfDebt thanks to his extravagant lifestyle ; the real big fish are swimming away.

@jhunjhunwala: BREAKING : SBI to change name to ‘State Bankrupt of India’ after loaning money to Vijay Mallya.

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