LONDON: A UK judge has rejected a request by Vijay Mallya for €136,000 (Rs 1.21 crore), acquired from the sale of his French mansion, to pay for further legal fees in his bankruptcy case as the businessman has not given full and clear disclosure from where his the legal fees may be met.
Mallya is seeking €2.8 million (Rs 24 crore) from the realisation of the €2.9million (Rs 25 crore) sale of his mansion -- Le Grand Jardin on the Isle St Marguerite in France -- to pay for his legal fees fighting the banks in the UK and in India. The funds from the sale of the mansion are currently being kept in the UK court funds office whilst Mallya fights a petition brought by the banks to declare him bankrupt.
Philip Marshall, Mallya’s barrister, told the High Court on Monday that Mallya had no UK assets from which to meet his ongoing legal expenses apart other than £250,000 (Rs 2.47 crore) in a UK bank account which was subject to a third party debt order and the realisation of the sale of the French estate.
“What has happened to all the cars which include Ferraris?” Insolvency and Companies Court Judge Sebastian Prentis asked.
“They are subject to controlled goods orders,” said Marshall, adding Mallya had no income as his consultancy work had been terminated.
Prentis rejected an urgent application by Mallya – which cost him £48,000 (Rs 47 lakh) in legal fees to bring -- for €136,000 (Rs 1.21 crore) from the UK court funds office, to pay for his next two hearings.
Prentis said a decision on £90,000 (Rs 89 lakh) would be made at a hearing on January 22 when his €2.8 million claim would be heard.
He granted permission for “Mallya’s reasonable costs of preparation for and attendance at a hearing on Wednesday" when Mallya is seeking permission to appeal certain decisions made to date in the bankruptcy proceedings but said he would not order payment out from the court yet as there was a lack of evidence about Mallya’s financial position and assets.
Tony Beswetherick, representing the Indian banks to whom Mallya owes £1.05 billion, demanded scrutiny of the money being sought. “The preservation of assets and preventing dissipation of assets should guide your judgment,” he said.
Prentis also ordered Mallya to pay the banks’ legal costs for Monday's hearing.
The cases Mallya says he needs cash to pay for his legal fees in India are his legal challenge over the interest accrued on the principal debt and his case in the Supreme Court of India whereby he is offering to pay off his debts using shares.