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A Division Bench, comprising Justice Jayant M. Patel and Justice Aravind Kumar, issued the direction after hearing a contempt of court petition filed in 2014 by the consortium of banks led by State Bank of India in connection with Kingfisher Airlines Ltd. case.
The Bench directed the counsel for Mr. Mallya, who is now residing in London, to communicate the order to him as his personal presence is essential to frame charges as he has now been arraigned as an accused in the contempt proceedings.
The banks have alleged that the “oral undertaking” was given on behalf of Mr. Mallya before the DRT on July 26, 2013, for not to transfer, alienate or otherwise to deal with his assets till the next date of hearing.
Further, the oral undertaking was reiterated before the DRT in four hearing dates in August, 2013, the banks pointed out.
When the matter was pending before the DRT and the High Court, the banks claimed that they came to know through a newspaper report that Mr. Mallya had pledged 1,04,86,666 shares of UB Ltd. held by him and another 1,04,64,288 shares held jointly by Mr. Mallya and his son Siddarth Mallya to Standard Chartered Bank.
‘Wilful disobedience’
The pledging of shares was confirmed on verification with stock exchanges, the banks said, while accusing Mr. Mallya of wilful disobedience of an undertaking given during a judicial proceeding and sought his prosecution under the Contempt of Courts Act.
Observing that the violation of declarations made either in writing or oral during a judicial proceeding resulting in overreaching of judicial process and frustrating the right of the other side amounts to contemptuous act depending on facts of each case, the Bench said that there is a prima facie case to proceed against Mr. Mallya for breach of undertaking.
As the undertaking was admitted, it has to be ascertained whether there was a breach of the undertaking affecting the sanctity of judicial proceedings, the Bench said.
He allegedly violated an ‘oral undertaking’ before the Bengaluru Bench of Debt Recovery Tribunal
