HC dismisses UBHL’s plea against order

BENGALURU: In a setback to United Breweries (Holdings) Limited (UBHL), the Karnataka High Court on Friday dismissed an appeal filed by it against the winding up order passed by a single judge.

Noting that there is no infirmity to interfere with the order passed by a single judge to wind up UBHL, which stood as a corporate guarantor for the loans obtained by the defunct Kingfisher Airlines Limited (KAL), a division bench of Justice Alok Aradhe and Justice Ravi V Hosmani dismissed the appeal filed by UBHL.

On February 6, 2017, the single judge had ordered that UBHL be wound up for failure to pay dues obtained by fugitive offender Vijay Mallya’s now-defunct KAL from banks and others. The UBHL filed the original side appeal before the division bench against this.

“No serious challenge on behalf of the appellant to the single judge’s order and only submission on merit with regard to the single judge’s order, which has been urged is that the assets of UBHL are more than its debts. Many assets are attached by the Enforcement Directorate (ED) or under the control of Debt Recovery Tribunal (DRT),” the division bench said.

The bench also noted that as per the apex court judgements, the High Court cannot prohibit the statutory authority from discharging its statutory functions. Hence, the High Court, under Section 483 of Companies Act, cannot prohibit the adjudicating officer, acting under Prevention of Money Laundering Act, 2002, or the recovery of debts due to Banks and Financial Institutions Act of 1993.

During the hearing, the counsel of Vijay Mallya submitted an offer of settlement in the proceedings. However, the division bench did not consider it as he was not a party to proceedings before a single judge and he (Mallya) had been declared as fugitive offender and facing contempt of court proceedings in this court.