Lenders to Kingfisher Airlines (KFA) are planning to move the Bombay High Court to get an early possession of airline’s prime property in Goa — Kingfisher Villa — sources told FE.
A senior banker at SBI said United Spirits — which had filed a petition against lenders — has been getting away with too many adjournments and the case is not progressing in the Mapusa Civil Court in Goa.
“To expedite the process we want to seek directions from a higher court,” he said. He added that although the case is being heard every month, adjournments are delaying possession of the property. “Another option is to wait for the next hearing, which is on August 18,” he said.
Possession of Kingfisher Villa in Goa is stuck in a judicial tangle after United Spirits claimed it was a tenant there since 2005 and, therefore, banks cannot sell it without its approval. United Spirits (USL) took the consortium to Mapusa Civil Court in Goa citing Portuguese Civil Code and requesting the court to block the auctions.
Even after Goa became a part of the Indian union in 1963 after several years of Portugese rule, Portugese Civil Code of 1867 is still applicable in Goa when it comes to property issues and marriages.
The source added that the company produced documents like electricity and water bills to prove that it has been a tenant in the property for the past 10 years.
The Goa bench of the Bombay High Court gave its consent to the KFA lenders to take the possession of Kingfisher Villa last year.
The Kingfisher Airlines, which has been grounded since 2012, has dues of over R7,000 crore to a consortium of 17 banks. The consortium is trying hard to recover dues by selling securities pledged by the firm. These included real estate and shares in multiple group entities.
At present, regulations require banks to set a reserve price for an asset and call an auction to dispose it off. If the first auction is not successful, a new reserve price must be fixed and a second auction be called before a bilateral negotiation can begin.