ED examines United Spirits CFO over Mallya payout deal

NEW DELHI: The Enforcement Directorate has examined Sanjeev Churiwala, chief financial officer of India’s largest liquor company United Spirits Ltd, a subsidiary of Diageo Plc, in its probe related to the company’s $75 million (around Rs 500 crore) payout deal with businessman Vijay Mallya.
The agency, as part of its money laundering probe in Kingfisher Airlines’ Rs 9000 crore loan, is also looking at the payout deal between the company and its former chairman – Vijay Mallya.The deal was signed on February 25 this year, according to which Mallya was to get US $75 million over a period of five years in return for stepping down as non-executive chairman of the company (United Spirits). TOI had first reported on May 1 that the MallyaDiageo payout deal had come under the ED’s scanner.
Sources say that Sanjeev Churiwala was examined a few days ago and clarifications were sought pertaining to the terms of the agreement, the basis on which the sum was decided as well as the mode and schedule of payment to Mallya. An ED official, however, clarified that Churiwala’s examination did not mean that he is under the scanner. The CFO was examined to seek information and clarifications on certain issues, he added.
When contacted, a USL spokesperson told TOI, “USL will respond to any government authorities’ requests for information”. Mallya was paid $40 million (close to Rs 265 crore) immediately as part of the deal by Diageo while the remaining sum is to be paid over five years. The agency believes that the $40 million was paid to Mallya outside India.
A week after the deal, on March 2, Mallya fled to London without informing CBI, ED or market regulator Sebi. A consortium of 17 banks to whom the businessman owes Rs 9,000 crore was also kept in the dark. Stepping up its probe against Mallya, ED has already examined some officials of the now-defunct Kingfisher Airlines in the matter, said sources. The agency is also in the process of identifying Mallya’s properties in India for ‘attachment’ purposes, an exercise which officials say should begin in two weeks’ time.