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A Supreme Court bench of Justices Lalit, Ravindra Bhat and PS Narasimha today reserved orders on sentencing and further course of action in a matter where fugitive businessman Vijay Mallya was held guilty of contempt.

On 30th November 2021, the court appointed Jaideep Gupta, Senior Advocate, as an amicus curiae in the matter. The matter finally came up for hearing today and the court intended to hear the amicus on sentencing and to find a way out for recovery of the amounts which he owes to creditors.

When the hearing for the matter commenced, Gupta submitted that Mallaya was held guilty on two counts - one for not disclosing the assets and secondly for violating express restraint order passed by the court.

Justice Lalit at this point said, “The proceedings in UK are like a dead wall, we know there is something pending but we don’t know what it is.”

Gupta, while informing the court that the nature of the contempt is civil, submitted that a fine will not meet the ends of the justice and imprisonment will be needed in this case.

Justice Bhat questioned, “In civil prison, usually aggrieved person bears the burden. Where is the question of burden here?” The court further opined that when they exercise the power to punish, they will exercise the provisions of the contempt of courts act as well as the constitution.

Gupta further submitted that apart from punishment, sequestration is an appropriate method of punishment. The court at this point questioned as to what could be done to those accounts from which monies were transferred to his family and questioned if it can retrieve it. Gupta opined that the court could.

Gupta further opined that the transactions made by Mallya to his family could be reversed and if the money does not come back his assets could be attached.

Justice Bhat opined that if it is left to the parties (creditors) to recover the outstanding amounts, they can use the order of the Supreme Court like ‘swords in their hands’ to enable recovery.

The Amicus submitted that in case the money had been transferred further from those accounts the court should pass an order to the effect of trancing the money. A counsel appearing for the banks submitted that the union could pass adequate sentence so that an example could be set and ends of justice could be met.

Ankur Saigal, advocate, appeared for Mallya and informed the court that he had received a communication from Malayya on 17th January, however he has no instructions from him in relation to this case.

The court on hearing the parties noted that Mallya was given specific liberty to advance his submissions in relation to the order of contempt, he was also given liberty to be represented by the counsel. The court noted that Saigal appearing for Mallya was invited to make submissions on merits but he has expressed his inability to do so. The court however directed Saigal to file written submissions if any and reserved the matter for orders.

Mallya had been held for contempt of court in 2017 for not disclosing the particulars of assets as directed by the court in a plea filed by State Bank of India. In addition to this, apex court had noted that the allegations for contempt are on two counts;

"a) He is guilty of disobeying the Orders passed by this Court in not disclosing full particulars of the assets as was directed by this Court.

b) He is guilty of violating the express Orders of Restraint passed by the High Court of Karnataka in the same Cause from which the present proceedings have arisen."

In connection to this, the Court had observed that Mallya is guilty of having committed contempt of court on both the counts. The Court had further observed that "though we have found him guilty of having committed contempt of court, we deem it necessary to give him one more opportunity and also hear him on the proposed punishment."

Case title: State Bank of India Vs Dr.Vijay Malayya