The liquor baron whose exit from India earlier this month has clocked a whole other controversy. (AFP File Photo)
Frustrated by their attempts to recover close to a billion dollars in debt from
Vijay Mallya, a consortium of banks have asked him to declare his assets.
The liquor baron whose exit from India earlier this month has clocked a whole other controversy, has tweeted that as an MP, all his assets are declared on the Rajya Sabha site.
Except, on the site, it says the 60-year-old has declared that he owns no properties.
So who owns the marquee homes that he flashed in his tenure of the Lifestyles of the Rich and Famous - the villas in Goa, seaside homes in Mumbai - where he hosted those lavish parties?
The answer is in the balance sheets of United Spirits Limited (USL), Mr Mallya's flagship spirits company, sold to UK-based liquor giant Diageo in 2013.
Diageo found the company it owned had 13 properties on its balance sheet, including Mr Mallya's sea-facing house in Mumbai, his bungalow on Sardar Patel Marg, Delhi and the splashy Kingfisher Villa in Goa.
So the liquor company had paid for a multitude of mansions for Mr Mallya's private use.
Remember this was in 2013- a year after Mr Mallya's Kingfisher Airlines had been grounded in financial disaster. By now, banks were owed hundreds of crores and the airline's former employees had not been paid for inordinately long periods.
Diageo's scrutiny also suggested that as the airline's debt entangled Mr Mallya, a billionaire, USL signed an agreement with a company called PE Data, nominated by Mr Mallya, granting it first rights to buy these properties.
For this right, before Diageo bought into USL in 2011, PE Data paid an advance of Rs 28 crore.
The current market value of just the three top properties, based on inputs from real estate experts, comes to 600 crores. But USL had agreed to sell all 13 homes to PE Data for only Rs 290 crore.
What made PE deserving of such a sweet deal? When we examined PE's balance sheets, it had a paid up capital of only Rs 10 lakh.
Our team visited its registered address in Bangalore to find it was the home of one of its directors. There was no business activity of any kind.
PE Data is owned by three other companies, also Bangalore-based. We visited those addresses as well - with similar results. In one case, there was no company at the given address.
We sent questions to United Breweries, Mr Mallya's company, to ask why PE curried such favour with Mr Mallya and what evidence it had furnished to prove it could afford to pay Rs 290 crore for the 13 properties. The company declined to comment.
As part of its termination agreement with Mr Mallya in February, reached after months of acrimony, Diageo cancelled the agreement with PE Data in February. The first right to purchase these properties has been transferred to Mr Malllya, but he will have to pay market rates. If he refuses, they will be auctioned.
Lawyer and activist Prashant Bhushan says the agreement with PE points to an effort by Mr Mallya to sell his residences to PE for a song ahead of the
Diageo deal and then buy them back, again at massively discounted rates. Part of that premise is that Mr Mallya was concerned that USL's new owner would not tolerate holding onto properties that were presented as company assets but were in fact the entrepreneur's homes.
Had USL sold the assets to PE Data, a prime chunk of Mr Mallya's real estate assets would have ended up in the hands of a mystery company for a bargain.