New Delhi: A Delhi court on Wednesday fixed 24 April for hearing the final arguments in a case against liquor baron Vijay Mallya for allegedly evading summons issued by the Enforcement Directorate (ED) in connection with alleged violation of foreign exchange rules.
The matter came up for hearing before Chief Metropolitan Magistrate (CMM) Sumit Dass, who posted it for next month. The ED had alleged that Mallya had violated the provisions of Foreign Exchange Regulation Act (FERA) in arranging funds to advertise his company's liquor products abroad.
ED had claimed that Mallya was summoned on four occasions for questioning in connection with a contract signed in December 1995 with London-based firm Benetton Formula Ltd for promotion of the Kingfisher brand abroad.
When Mallya failed to appear before ED in response to the summons, a complaint was filed on March 8, 2000 before a court here and later on charge was framed against him under section 56 of FERA.
According to ED, Mallya had allegedly paid $200,000 to the British firm for displaying Kingfisher logo in Formula One World Championships in London and some European countries in 1996, 1997 and 1998.
The agency had claimed that the money was allegedly paid without prior approval from RBI in violation of FERA norms.
"It would be travesty of justice if Mallya leaves the country and does not return to pay the dues in the form of Service Tax, admittedly, collected from the passengers," the Department submitted.
It pleaded that since statutory dues were not paid to the government, the petition against Mallya should be heard as expeditiously as possible.
The department had filed two cases in a magistrate's court in Mumbai for recovery of dues. In the case pertaining to recovery of Rs 32.68 crore as Service Tax, the lower court had granted him anticipatory bail to Mallya last year on the ground that the offences were bailable.
The aggrieved department challenged the order in the Bombay High Court contending the offences were non-bailable. It urged for quashing and setting aside the impugned order of the magistrate. This petition (appeal) is pending in the high court.
Meanwhile, in the same matter before the high court, the department made a fresh plea today seeking to impound the passport of Mallya and restrict his movement abroad. It also sought his presence in the high court and in the trial court.
Notably, the plea against Mallya came up in the high court on the day the Supreme Court issued notice to him and sought his response within two weeks on a plea filed by a consortium of banks seeking direction for freezing his passport and his presence before the apex court.
Mallya is facing legal proceedings for allegedly defaulting loans of over Rs 9,000 crore from various banks.
The apex court was also informed by the government that Mallya had left the country a week ago.
When the petition of Service Tax department came up for hearing in the high court this morning, the judge said he would prefer to wait for the Supreme Court order. In the post lunch session, the department's lawyer informed the high court that the apex court had issued notice to Mallya.
The High Court asked him to make a mention of his petition on Friday (11 March) and said it would take up the matter on that day.