SBICAP Trustee Company, a wholly owned subsidiary of SBI Capital Markets, on Friday said in a newspaper notice it would hold an e-auction of Kingfisher House, Kingfisher Airlines’ corporate office in Mumbai, on March 17.
The reserve price for the property has been set at Rs 150 crore, SBICAP Trustee said in the notice on Friday. 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, 2002.
The notice said Mallya owed banks over Rs 6,963 crore. The land along with the building measures around 3,988 sq m, according to the public notice.
Kingfisher’s lenders have not been able to recover their loans and their efforts have met with multiples hurdles. One of the assets banks have been trying to auction is Kingfisher House, while 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 income tax 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 department had said that Kingfisher Airlines had deducted tax at source from employees’ salaries and other payments but did not to remit it to the government account.
The villa in Goa is also in dispute as United Spirits has claimed it was a tenant there since 2005 and, therefore, banks cannot sell it without its approval. Kingfisher Airlines, which has not flown since October 2012, owes close to Rs 7,000 crore to bankers that have been trying to recover their dues by selling securities pledged by the firm. These include real estate and shares in multiple group entities. Banks had also sold around 4 lakh pledged USL shares for Rs 104 crore in 2014.