 "Kingfisher's Mumbai office to be auctioned as Mallya fails to pay dues")
The headquarters of Kingfisher Airlines in Mumbai has been taken over by its lenders after the beleaguered airline company failed to pay up its bank dues. KFA is required to pay Rs 6,027 crore along with interest.
According to CNBC-TV18_,_ SBICAP Trustee Company Ltd, an arm of the State Bank of India , took possession of Kingfisher House in Mumbai on August 10 and has put the property up for auction. Among the consortium of 17 banks, SBI has the largest exposure to KFA at Rs 1,600 crore.
The Mumbai office premises situated on the Western Express Highway,covers an area of over 17,072 sq ft.
KFA House is the headquarters of the airline in Mumbai and the sale of the property will be used to repay loans of close to Rs 6,027.42 crore owed to SBI. SBICAP is yet to take possession of KFA Villa in Goa.
[caption id=“attachment_1025543” align=“alignright” width=“380”]  Vijay Mallya. AFP[/caption]
SBI Caps, on behalf of the lenders, had issued a notice to KFA under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act on May 3, 2013. The notice is a precursor to acquiring a defaulter’s property under the Act.
“The Act says that if the borrower fails to repay within 60 days of the notice, lenders can take possession of assets and dispose of them,” a bank official who is among the lenders to Kingfisher Air told Times of India.
Meanwhile, the indirect tax department has also hinted that Vijay Mallya, owner of the grounded Kingfisher Airlines, may face prosecution in a service tax evasion case.
Impact Shorts
More Shorts“Prosecution is definitely a provision in the Act. And that decision of taking action on Kingfisher owner for not paying service tax arrears will be taken by the concerned commissioner,” Lipika Majumdar Roy Chowdhury, member, Central Board of Excise and Customs said.
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