UBL management supports Mallya, suggests him to continue as chairman

Coming out in support of the embattled liquor baron Vijay Mallya, the United Breweries Ltd management today said he would continue as UBL chairman despite reports that ED had attached his shares in the firm. UBL has sought legal opinion from a former chief justice of India, Company Director Chug Yogendra Pal, who chaired its AGM here, said while replying to a query.

Pal said that as per law, Mallya can continue as the chairman. He further said that, as of now, the Enforcement Directorate (ED) had "not attached" any properties and shares of UBL and Mallya is not disqualified to be the chairman of the company.

The backing comes in the wake of reports that Mallya would lose his position as chairman after the seizure of his shares in UBL by ED.

On September 5, ED had issued its second attachment order for assets worth Rs 6,630 crore against Mallya as it seized his farmhouse, flats and FDs in connection with its money laundering case against him and his associates.

The agency had recently expanded the probe in this regard as it took over investigation into the alleged default of loan taken from an SBI-led consortium of nationalised banks.

A fresh case was filed by CBI last month. The total attachment made by the agency in this case has now shot up to Rs 8,041 crore as it had attached assets worth Rs 1,411 crore a few months ago.

The provisional attachment order, issued under the provisions of the Prevention of Money Laundering Act, said it has ordered seizing shares of USL, United Breweries Ltd and McDowell Holding company, jointly held by the liquor baron and UBHL, and his controlled entities, worth Rs 3,635 crore.

Apart from this, the ED ordered seizure of a farm house in Mandwa in Alibaugh worth Rs 25 crore, multiple flats in Kingfisher tower in Bengaluru worth Rs 565 crore and Mallya's fixed deposits with a private bank to the tune of Rs 10 crore.

The agency has alleged that these assets were the "proceeds generated out of criminal activity" of the alleged default of bank loans as it claimed that Mallya "criminally conspired" with Kingfisher Airlines and United Breweries Holdings to obtain funds through the consortium of banks. Of this total amount, the principal Rs 4,930.34 crore still remains unpaid.