SC lawyer Dushyant Dave says delayed action by govt banks allowed Vijay Mallya to flee; SBI denies charges

The controversy over liquor baron Vijay Mallya’s escape from India, and the arising suspicion that investigating agencies and government inaction may have given him enough time to flee, refuses to die down.

On Friday, several media reports suggested that the lending banks suspected Mallya to be a flight risk, yet they delayed taking action despite legal advisors suggesting otherwise.

Merelythreedays before Mallya fled the country, the State Bank of India was advised by lawyer Dushyant Dave to move court to prevent Mallya from fleeing. The SBI management had reportedly sought Dave’s advice stating hat it had an inkling that Mallya could flee the country.

“I advised SBI to approach the Supreme Court on 29 February, 2016, for getting an order restraining Mallya from leaving the country… SBI chairperson and people at the top within the government knew about this meeting and the advice given by me. However, there was no action taken on it,” Dave told The Indian Express. Dave claimed that four top SBI officials were supposed to meet him the following day to get an order from the Supreme Court restraining Mallya from leaving the country but the bank officials did not turn up.

“I have no doubt something happened after I gave my advice,” Dave told India Today TV.

However, the SBI has officially denied Dave’s claims asserting that there was no laxity on its part.

Interestingly, similar reports about Dave advising the bank to move court had emerged earlier as well. A report in The Times of India, published 10 March, 2016, also stated the same thing, adding that Dave advised taking immediate action to restrain Mallya from going abroad.

Speaking to India Today, senior advocate and former Attorney-General of India Mukul Rohatgi also opined that a more aggressive approach and prompt action could have avoided the investigating agency and the government a lot of embarrassment. Rohatgi said that the legal system allowed two courses of action: Either the SBI could have moved Supreme Court requesting that Mallya’s passport be impounded, or it could have asked the court to issue orders restraining him from travelling abroad. But the bank took too long to act on its own inhibitions and Mallya was safely docked away in London two days later. He hasn’t returned since.

Furthermore, the Central Bureau of Investigation has also previously publicly expressed its displeasure over laxity from the bank’s side. According to a report in The Economic Times, CBI chief at the time, Anil Sinha lashed out at banks for unduly delaying in filing complaint against Mallya, incidentally on the same day as Mallya fled.

“Despite our repeated requests, the banks did not file a complaint with CBI… We had to register the case on our own initiative. The question is that the undue delay in identifying & reporting such a fraud has jeopardized the cause of justice to the offenders benefit, giving them opportunity to divert funds and destroy evidence. All of us must ponder over this issue,” Sinha had said.

Meanwhile, outside of this activity, it is relevant to point out that the CBI is also facing tough questions as to why did it downgrade an earlier lookout notice issued against Mallya. Congress president Rahul Gandhi also tweeted on the issue alluding that the prime minister must have been in the know before CBI downgraded its ‘detain’ on arrival notice to ‘inform’.

However, the CBI in its defence had said that the 2015 look out notice of “detain” was an “error” in judgment because he was cooperating in the probe and there was no warrant against him.

CBI sources said when the first Lookout Circular was issued on 12 October, 2015, Mallya was already abroad. Upon his return, the agency was asked by the Bureau of Immigration (BoI), if Mallya should be detained as sought in the Lookout Circular to which the CBI said there was no need to arrest or detain him as he was a sitting MP and there was no warrant against him, they said.

It said the agency only wanted information on his movements, they said.

Besides, the probe was in an initial stage and the CBI was collecting documents from the IDBI in the Rs 900 crore loan default case, they said.

The CBI issued a fresh Lookout Circular against Mallya in the last week of November, 2015 asking airport authorities across the country to “inform” it about Mallya’s movements, thus replacing its previous circular which had sought detention of the businessman if he attempted to leave the country, they said.

The Lookout Circular depends on the issuing authority and, unless it asks the BoI to detain a person or to stop him from boarding a plane, no action is taken.

The sources said Mallya travelled abroad in October and returned in November, then made two trips in first and last week of December and also a trip in January, 2016.

In between, he had appeared for questioning thrice since the lookout notices were issued — once in New Delhi and twice in Mumbai between 9 and 12, December 2015.

The agency sources said that the change in the notice was an error in judgement and since he had been cooperating, there was no reason to stop him from moving abroad.

However, on 2 March, 2016, Mallya left the country and has been in the United Kingdom where he has been fighting the extradition case.

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