1. Vijay Mallya case: Kingfisher House e-auction may fail again

Vijay Mallya case: Kingfisher House e-auction may fail again

E-auction of Kingfisher House may fail again

By: | Mumbai | Updated: August 3, 2016 6:46 AM
Kingfisher house, Kingfisher, Kingfisher airlines, Kingfisher house mumbai, Kingfisher beer, Kingfisher calender, Kingfisher airlines share price, Kingfisher paytm, Kingfisher models, Vijay Mallya, Vijay Mallya news, Vijay Mallya wife, Vijay Mallya house, Vijay Mallya cars, Vijay Mallya net worth, Vijay Mallya twitter, Vijay Mallya property, state bank of india, sbi, sbi wilful defaulter, pnb, pnb defaulter, npa, bad loan, psbs SBICAP Trustee Company, a wholly owned subsidiary of SBI Capital Markets (SBI Cap), in a public notice last month announced e-auction of the property, situated near the Chhatrapati Shivaji International Airport. (PTI)

The e-auction of Kingfisher House – Kingfisher Airline’s corporate office in Mumbai – to be held on Thursday by SBICAP Trustee Company may fail again, with no buyer understood to have approached SBICAP as yet. The last attempt to sell the property in March had failed due to a similar lack of interest.

Two sources with knowledge of the development said SBICAP Trustee has not received the earnest money deposit (EMD) from any interested buyer as of Tuesday. The last date for submission of bid application documents, EMD amount and KYC documents was set at 5 pm on Monday. Bidders were required to submit 10% of the reserve price or Rs 13.5 crore as the EMD amount. The reserve price for the property was Rs 135 crore.

People familiar with the auction said bidders found the reserve price too high. “Despite a 10% reduction in the reserve price from Rs 150 crore earlier, buyers still feel it is high,” a source said.

SBICAP Trustee Company, a wholly owned subsidiary of SBI Capital Markets (SBI Cap), in a public notice last month announced e-auction of the property, situated near the Chhatrapati Shivaji International Airport. The auction is part of the recovery process of dues from the airline’s promoter Vijay Mallya under the Securitisation and Reconstruction of Financial Assets and Enforcement of Security Interest Act (Sarfaesi), 2002. The public notice said Mallya owed banks over Rs 6,963 crore. The land along with the building measures around 3,988 square metre, according to the public notice.

Lenders to Kingfisher have not been able to recover their loans and their efforts have met with multiple hurdles. One of the assets that banks have been trying to auction is Kingfisher House in Mumbai. They are also trying to take possession of Kingfisher Villa in Goa.

Kingfisher House is among the assets pledged by the company to a consortium of 17 banks. In 2013, the I-T department had moved a Bengaluru court asking lenders to first settle the dues of the department amounting to Rs 350 crore as the property was attached under the I-T Act. The I-T department had said that Kingfisher Airlines (KAL) had deducted tax at source from employee’s salary and other payments but did not to remit it to the government’s account.

Kingfisher Airlines, which has not flown since October 2012, owes close to Rs 7,000 crore to bankers who have been trying to recover their money by selling securities pledged by the firm. These include real estate and shares in multiple group entities.

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