After liquor firm United Spirits last week found potential diversions of around Rs 900 crore linked to its former chairman Vijay Mallya, the Enforcement Directorate has reportedly started investigation based on the complaint by its current owner and the world's largest liquor firm Diageo.
Based on a slew of complaints the regulators received a week ago, the ED is investigating foreign exchange violations worth Rs 900 crore by Mallya, a report in The Economic Times said.
Following its internal inquiry, USL said Mallya diverted funds to over half a dozen companies, having direct or indirect interest, said the ET report.
"The funds have been routed through USL subsidiaries to around seven entities related to Mallya including four in the UK, two in the Bahamas and one in Europe," ET quoted an official, adding that USL has evidence of all the remittances made.
The internal inquiry revealed actual and potential diversions of about Rs 910 crore ($135.5 million) and other potentially improper transactions amounting to about Rs 310 crore involving USL and its subsidiaries between October 2010 and July 2014, USL said in a filing to stock exchanges after a board meeting on 9 July.
The overseas beneficiaries or recipients include Force India Formula One team, Watson Ltd, Continental Administrative Services, Modall Securities, Ultra Dynamix and Lombard Wall Corporate Services, while the Indian beneficiary was mostly Kingfisher Airlines.
Already, the ED is already investigating a fund diversion case against Mallya, where the former liquor baron allegedly routed IDBI Bank funds through Kingfisher Airlines.
However, Mallya has denied the charges by USL. "I have absolutely no knowledge about the purported enquiry by E&Y nor the suggested allegations," ET quoted Mallya.
Mallya agreed in February to give up his chairmanship and board position at United Spirits.
The company said at the time that it would continue to pursue a claim for the recovery of Rs 1,337 crore of loans to former group company United Breweries Holdings Ltd (UBHL).
Meanwhile, the Supreme Court later on Monday will hear the contempt petition filed by a consortium of banks against businessman Vijay Mallya, said The Indian Express citing ANI report.
In April, the apex court had directed Mallya to disclose all of his assets held by him and his family.
The consortium of banks had also rejected his offer to repay Rs. 4,000 crores as settlement of all debts.
It is learnt that Mallya is currently in London. He had left India on 2 March 2016, the day the banks moved the Supreme Court against him.
Later in an interview to Reuters, Mallya had said he was willing to answer questions about his business dealings but was reluctant to return to his homeland "unless assured of a fair trial in India, if at all there needs to be a trial".
Updated Date: Jul 18, 2016 13:07 PM