UK court orders Mallya to pay costs to banks

The UK High Court has ordered embattled liquor tycoon Vijay Mallya to pay a minimum of £200,000 towards costs incurred by 13 Indian banks in their battle to recover alleged dues.

Last month, Judge Andrew Henshaw had refused to overturn a worldwide order freezing Mallya’s assets and upheld an Indian court’s ruling that a consortium of 13 Indian banks led by State Bank of India (SBI) were entitled to recover funds amounting to nearly £1.145 billion.

As part of the judgment, the court has also ordered Mallya, 62, to pay costs towards registration of the worldwide freezing order and for the Debt Recovery Tribunal of Karnataka’s judgment in Britain.

“The court ordered that Mallya pay the banks’ costs. The standard order is that the court will assess those costs unless the parties can otherwise agree a figure for what should be paid,” said a legal expert familiar with the case.

The court’s assessment of costs is a separate process, which ends with another court hearing before a specialist costs judge in the UK. But in the meantime, Mallya must pay £200,000 towards this legal costs liability.

The legal costs owed to the banks emerged in a subsequent court order by the same judge.

“The First Defendant's (Mallya) application for permission to appeal is refused. Any further application for permission to appeal should be made to the Court of Appeal to be dealt with by a judge of that court,” the judgment notes.

Mallya, who is also separately fighting extradition to India on fraud and money laundering charges worth an estimated ~90 billion, has since filed an appeal notice at the Court of Appeal, which includes an application for permission to appeal.

Permission will only be granted if the court considers that the appeal would have a real prospect of success or there is some other compelling reason for the appeal to be heard.

Meanwhile, Mallya is due back at the Westminster Magistrates’ Court in London next month for one of the final hearings in his extradition case.