Now, UCO Bank looks at identifying KFA as wilful defaulter

Written by fe Bureau | Kolkata | Updated: Oct 28 2014, 07:37am hrs
Government-owned UCO Bank on Monday said it is in the process of identifying Vijay Mallyas Kingfisher Airlines (KFA) as a wilful defaulter for non-payment of about R300-crore outstanding dues.

We are in the process... An internal committee is looking into it, a senior official of the bank who did not wish to be named told FE. The official, however, declined to give a time frame within which the bank would identify the grounded carrier as a willful defaulter. First, the internal committee will look into the details of a possible diversion of funds by KFA. If it finds evidence, the committee would indentify the airline as a willful defaulter and issue a notice to its promoter, he said.

Once the company is identified as a willful defaulter, the bank will then also ask its directors to appear before its grievance redressal committeeit is a long and complicated process,the official added.

Earlier, public sector lender United Bank of India had declared Kingfisher Airlines chairman Vijay Mallya and three other directors of the airline as wilful defaulters in September. United Bank, which cracked down on Kingfisher Airlines for non-payment of over R300-crore outstanding dues, became the first bank in the countrys banking industry to declare Mallya as a wilful defaulter.

Later, however, Kingfisher Airlines secured a stay from the Calcutta High Court on the Kolkata-headquartered lenders decision. The court had directed the bank to file its affidavit-in-opposition by November 3.

The State Bank of India (SBI) has already sent a notice in this regard to Mallya and his companys directors Ravi Nedungadi, Anil Kumar Ganguly and Subash Gupte.

A consortium of 17 banks, led by SBI, has a R7,600-crore exposure to KFA, which has been declared as a non- performing asset (NPA).