The Telegraph
Thursday , July 10 , 2014
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Kingfisher, UBI lock horns

Court tussle

Calcutta, July 9: The grounded Kingfisher Airlines today moved Calcutta High Court challenging a letter issued by the United Bank of India that asked its chairman Vijay Mallya and other board members to meet the bank officials for alleged wilful default on payment of dues to the tune of about Rs 400 crore.

Sudipta Sarkar, the counsel for Kingfisher Airlines, submitted a plea before Justice Dipankar Dutta seeking withdrawal of the notice.

He also sought permission for a legal representative of Kingfisher to appear in place of Mallya, which the bank authorities had refused.

The Kingfisher counsel submitted that the bank cited an RBI rule, which has no provision for such a representation.

The counsel claimed that as there was no provision, it was the discretion of the bank concerned to grant their prayer, but the UBI has disallowed its contention without citing any reason.

Hirak Mitra, the counsel appearing for the UBI submitted that a credit of Rs 398.22 crore was given to Kingfisher Airlines by the bank. They alleged that the repayment was defaulted and funds were diverted.

It was claimed that a consortium of banks led by the State Bank of India had extended loans to Kingfisher. The UBI was part of the consortium. They stated that it was just a showcause notice wherein the airline authorities were required to produce the accounts.

After hearing both the arguments, Justice Dutta said he would deliver his order tomorrow.