“Justice Arvind Kumar adjourned the case to April 11, as arguments on both sides could not be completed for want of time,” a counsel, who appeared for the creditors, told reporters.
Creditors like French bank BNP Paribas and State Bank of India, lessors such as Rolls Royce and International Aero Engines and state-run oil marketing firm HPCL had jointly filed petitions in the high court in November 2013 after the cash-strapped airline and its holding firm UBHL failed to repay dues worth Rs.600 crore.
When the Paribas counsel appealed to the judge for giving priority to its petition as it was the first aggrieved party to approach the court in November 2012 for relief, Justice Arvind Kumar said justice would be done to all the petitioners as they were same in the eyes of law.
As the group’s flagship company, the Mallya-controlled UBHL has equity stakes in United Breweries Ltd (UBL), the country’s largest beer producer, and United Spirits Ltd., the country’s largest liquor maker, now controlled by the British Diageo plc.
Though Mallya lost control over United Spirits Ltd., he still has controlling state (52.34 percent) in the holding firm, which was funding the grounded airline.
According to the Paribas counsel, the holding company borrowed $26.63 million from the French bank to purchase three aircraft for its airline but failed to repay the principal amount as well as interest on it.
“We have petitioned the court to order winding up the holding company as it failed to honour corporate guarantees it gave on behalf of the airline,” the bank counsel said.
UBHL’s employees, however, opposed winding it up as it would render them jobless and affect the group’s other companies, including the profit-making UB Ltd.
A consortium of 17 state-run and private banks, led by the SBI, on March 8 moved the Supreme Court after it failed to get relief from the Karnataka High Court and the debt recovery tribunal against defaulter Mallya and his airline, which owns a whopping Rs.9,000-crore debt, including compound interest.
The apex court on March 9 served notice to Mallya and posted the case for hearing to March 30, although he left the country on March 2 and is learnt to be staying in London.