Extraditing fugitives is hardly ever smooth and simple. Currently the government of India faces the uphill task of extraditing fugitive businessmen Vijay Mallya and Nirav Modi, who have been booked for numerous offenses including money laundering. Here is a new law to tackle Vijay Mallya, other fugitive fraudsters
As offenders Vijay Mallya and Nirav Modi remain out of reach of the Indian government, nation’s banking sector is suffering. Gross non-performing assets (NPAs) or bad loans have piled up to a whopping Rs 10.25 lakh till March 31, 2018.
Reserve Bank of India (RBI) has said that Gross NPA ratio might go up from 11.6 per cent in March 2018 to 12.2 per cent by the end of the current fiscal. NPAs are a result of people defaulting on loan repayments.
Nirav Modi fled the country after Rs 11,500-crore fraud with Punjab National Bank (PNB) and Vijay Mallya owes more than Rs 9,000 crore to various banks.
"Macro-stress tests indicate that under the baseline scenario of current macroeconomic outlook, SCBs' (scheduled commercial banks) GNPA ratio may rise from 11.6 per cent in March 2018 to 12.2 per cent by March 2019," RBI said.
Among banks with highest bad loans, State Bank of India (SBI) is on top with Rs 2.23 lakh crore, according reports. Nirav Modi, who defrauded Punjab National Bank (PNB) has Rs 86,620 crore bad loans.
It is a big challenge for the government to find a solution to this alarming situation of bad loans in banking sector.
How Vijay Mallya, Nirav Modi cheated and fled
Vijay Mallya, the “King of Good Times”, really enjoyed good times even in the time of crisis of his Kingfisher Airlines. With loans piling up and his airlines shut due to heavy losses, Mallya quietly gave the slip to the banks and fled India to escape to the United Kingdom on March 2, 2016.
Mallya’s exit from India was not known to the banks. He had left India few days before the banks approached the Supreme Court to make sure he did not leave the country. But it was late by then.
The Bengaluru businessman is still evading the law in India and continues to stay in Britain. However, he has made appearances in London courts and was arrested once but released on bail.
Nirav Modi too hoodwinked the bank officials and bid goodbye to India. On January 1, 2018, Nirav Modi flew out of the country. It was only on January 29, 2018 that Punjab National Bank (PNB) complained to Central Bureau of Investigation (CBI) against the diamantaire.
After fleeing from India, he travelled to several countries. His passport had been revoked and today (July 2) a red corner notice has been issued by The International Criminal Police Organisation (Interpol).
Not only Vijay Mallya and Nirav Modi, there are 29 other Indian fugitives who owe crores of rupees to banks. This is according to media reports.
While India is trying to extradite Vijay Mallya and Nirav Modi, it has still not succeeded. There are many hurdles for this. Vijay Mallya cited political persecution as his defence when faced with extradition. India has extradition treaty with the United Kingdom but according to reports, so far, they have managed to extradite only one.
Vijay Mallya is also contemplating seeking political asylum and has also put forth the argument to UK courts about not good human rights standards in India.
Nirav Modi too might go on the same lines of arguments to avoid extradition. Another challenging aspect is to know the exact location of Vijay Mallya and Nirav Modi.
With red corner notice issued by Interpol, it remains to be seen how this succeeds in getting Nirav Modi to India.
The government has come out with The Fugitive Economic Offenders Bill, 2018 where India can impound properties of offenders who run away from the country. This has been signed by the President. It has to be passed in the Lok Sabha. This Bill will target fugitives who have offences/fraud over Rs 100 crore.
This is a good move by the Union government but experts feel there needs to be more clarity. Properties confiscated could be challenged in a court by the offenders.
Recently, Vijay Mallya’s jet went for only Rs 34.8 crore when the service tax authorities had pegged the price at Rs 152 crore in first auction in March 2016. The jet was finally sold after four failed attempts.
It remains a million-dollar question as to when Vijay Mallya and Nirav Modi will be brought back to India to face the law. The wait continues.
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Last Updated 5, Jul 2018, 2:14 PM