Keeping in mind the Supreme Court’s direction to wind up the Vijay Mallya case as soon as possible, Debt Recovery Tribunal Presiding Officer C R Benkanahalli today said he would pass orders on three interlocutory applications filed by Heineken, Kingfisher Finvest and Diageo Plc and its subsidiaries tomorrow.
Dutch beer major Heineken had filed an application before the Debt Recovery Tribunal, seeking to be impleaded in the case to enjoy Right of First Refusal (ROFR) over UBL shares.
[related-post]
Heineken has some presumptive rights on UBL shares held and owned by Mallya.
ROFR is a contractual term between shareholders, usually included in Articles of Association. If a shareholder wishes to dispose shares that are subject to ROFR, it must first be offered to those other shareholders who have its benefit.
On the other hand, Diageo Plc had filed an interlocutory application seeking vacating of DRT’s March 7 order.
DRT had barred Mallya from withdrawing USD 75 million exit payment from Diageo till disposal of the case over the loan default by Kingfisher Airlines.
It had restrained Diageo and United Spirits Limited, owned by the UK-based firm, from temporarily disbursing the amount to Mallya, who worked out the deal under a severance package.
But USD 40 million of the USD 75 million severance package deal had already been disbursed, following which the bankers’ consortium had sought directions from DRT to attach the amount before it.
On a DRT directive, Diageo Plc and its two subsidiaries submitted details of the severance package deal, in which bankers figured out that USD 40 million of the USD 75 million was parked in an account by Mallya in New York-based J P Morgan Bank.
On May 17, DRT had directed the bank not to disburse to Mallya USD 40 million and asked it to “attach” (submit) before it statements of accounts held by Mallya in the bank.
Diageo Holdings Netherlands had also filed an Interlocutory Application, seeking vacating of the DRT’s March 7 order.
DRT will also pass orders on Kingfisher Finvest’s IA, seeking dismissal of bankers’ plea on ‘Lifting of Corporate Veil’, arguing the original application did not mention it.
The bankers had pleaded before the DRT for Lifting of Corporate Veil to pierce the protection against personal liability enjoyed by individuals controlling the company.
The doctrine of Lifting of Corporate Veil means disregarding the corporate personality and looking behind the persons controlling the company.
