More bad news for the ‘King of good times’. Former liquor baron Vijay Mallya was last week served a £1.15-billion ($1.5 billion) worldwide freezing order, which prevents access to his assets.

The order came after a London judge allowed a January Indian court ruling over Mallya’s assets to be enforced in the UK, according to a copy of the banks’ skeleton arguments, Bloomberg reported. He can now spend only about £5,000 ($7,000) per week.

The report said Mallya’s lawyers are trying to overturn the ruling. Last week, a London judge granted a short extension to respond to the order because of simultaneous proceedings over his extradition.

The Government may end up paying over $1 million to Mallya if its plea for his extradition in the London court fails. Though other options are available to delay the payment, the Centre will eventually have to pay the court expenses incurred by Mallya, a London-based international arbitration lawyer said.

The banks to which Mallya owes ₹9,000 crore had claimed that he is the beneficial owner of at least three properties, cars and other valuables. These include a house near London which he bought for £11.5 million, a lodge for £1.5 million and other assets.

Sarosh Zaiwalla, Founder and Senior Partner at Zaiwalla & Co, told BusinessLine that the government, through the banks, should try to pursue the worldwide freezing order rather than the extradition case itself. “Extradition alone will not lead to Mallya repaying the loan he owes to banks but the freezing order would,” he pointed out.

Zaiwalla said once this is enforced, an English judge will monitor how he uses the money. Mallya will have to declare all his assets and has to say, under an affidavit, that he has no beneficial interest. “Life becomes very difficult once the worldwide freezing is ordered,” he said.

Zaiwalla and the senior solicitor at the law firm, Kartik Mittal, said that, with regard to the extradition case, India should be able to prove that loans taken by Mallya from the lender-banks were used for purposes other than those originally intended.

“It is not going to be an easy process. The criminal charge must be recognised in the UK as well if there is evidence that Mallya was involved in money laundering fraud.”

“Extradition is sensational and is not the right remedy,” they pointed out.

Mallya is expected to bring up the matter of how he is a politically exposed person and that other corporates have borrowed more money from banks than he has. Even if the Government wins the extradition case, Mallya may be advised to appeal and, if he seeks bail, it will be granted immediately.

However, if the case falls through, the government will have to pay Mallya costs for fighting the case which could be over $1 million, said Zaiwalla.

Both the solicitors said it would take three to five years before Mallya is brought back to India, even if the extradition case goes in the Government’s favour. Mallya can appeal before the Supreme Court and even go to the European court if he alleges human rights violation.

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