Vijay Mallya Scandal: Full Story of Recovery and Hope

Nine years after his controversial departure from India, Vijay Mallya resurfaced in a four-hour-long podcast, boldly proclaiming, “I am not a chor. I am probably the only chor who is being called chor after repaying two and a half times.” This assertion, emblazoned on the podcast thumbnail, raises a fundamental question: if a thief’s stolen goods are recovered, does that absolve them of their crime? This deeply unsettling logic, if accepted, would allow any economic offender to declare their slate clean upon asset forfeiture.

The Vijay Mallya saga is a labyrinth of unfulfilled promises, alleged fraud, and a dramatic escape that has captivated the Indian public for nearly a decade. This article delves into the claims made by Mallya in his recent podcast with YouTuber Raj Shamani, juxtaposing them with established facts, news reports, and legal proceedings to unravel the complex truth.

The Escape: A Fateful Delay

The narrative begins on February 28, 2016, when State Bank of India (SBI) officials met with Supreme Court lawyer Dushyant Dave. Their urgent concern: Vijay Mallya, burdened by an alleged ₹9,000 crore debt, might flee the country. Dave advised immediate action through the Supreme Court. However, on February 29, SBI officials failed to meet Dave as planned for the petition filing. It was only on March 5, five days later, that SBI finally approached the Supreme Court. By then, it was too late; Mallya had departed India on March 2.

In his 2025 podcast, Vijay Mallya asserts he did not flee, but rather informed then-Finance Minister Arun Jaitley of his travel plans to Geneva. He stated, “I told the Finance Minister Arun Jaitley before leaving for the airport and then I flew.” This claim, and many others, form the cornerstone of his defense throughout the extensive podcast.

The Podcast Phenomenon: PR or Public Discourse?

Vijay Mallya’s choice to appear on a podcast with a YouTuber, rather than traditional Indian media, is noteworthy. It signals a potential shift in how high-profile individuals choose to present their narratives, perhaps reflecting a perceived erosion of trust in mainstream Indian media. However, it also raises a critical concern: are podcasts becoming mere vehicles for public relations, allowing individuals accused of serious financial crimes to control their narrative without rigorous journalistic scrutiny? The appearances of figures like Lalit Modi on similar platforms, and Byju’s CEO with ANI’s Smita Prakash, underscore this growing trend. This prompts a vital question: why do these individuals, facing allegations of multi-crore frauds, prefer podcasts over interviews with seasoned journalists?

Decoding Mallya’s Defense: A Fact-Check

Let’s examine Vijay Mallya’s key claims and the underlying facts:

Allegation 1: Unpaid Employee Salaries

Vijay Mallya’s Kingfisher Airlines ceased paying employee salaries in mid-2012, eventually halting all flights by October 2012, and formally losing its license by December 2012. By January 2013, employees had gone eight months without pay.

In the podcast, Vijay Mallya asserts his deep care for employees, stating, “I would ask anyone to check on how I cared for my employees. I was proud of the care that I gave to my employees.” He attributes his inability to pay salaries to the Karnataka High Court seizing funds, claiming, “There was money lying in deposit with the Karnataka High Court. I specifically applied to court to pay the salaries of Kingfisher staff. The banks objected and the court refused the permission.”

The Reality Check: While the Karnataka High Court did seize some Kingfisher Airline funds in 2013, salary payments had already stopped in mid-2012. Blaming the High Court for the initial non-payment is misleading. Furthermore, Mallya’s 2013 petition to the High Court sought the release of only ₹13 crore for one month’s salary, not the total outstanding amount. Even if approved, this would have addressed only a fraction of the ₹300 crore owed to nearly 3,000 employees. Many employees are still owed between ₹25 lakh and ₹50 lakh.

When confronted about his lavish lifestyle amidst employee distress, particularly a ₹13 crore 60th birthday party in December 2015, Mallya saw no issue. He argued, “Paid for it myself. Kingfisher Airlines was in no position to pay. But okay, maybe it was a mistake. I should have probably come here to London and had my party and nobody would have known.” His argument essentially was that as a successful businessman with other profitable ventures, he was entitled to his personal expenditures, regardless of Kingfisher’s struggles. Then-RBI Governor Raghuram Rajan rightly criticized this, highlighting the public’s perception of indifference when such extravagance is flaunted amidst substantial debt.

Adding to the gravity, Kingfisher Airlines failed to deposit employee tax deductions with the Income Tax Department, despite legal requirements to do so within seven days. This resulted in employees receiving tax notices, further compounding their financial woes.

Allegation 2: “I Didn’t Borrow, Kingfisher Did”

Vijay Mallya technically claims that he personally didn’t borrow money, but rather Kingfisher Airlines did, stating, “First of all, let me clarify here, when you keep saying you borrowed, it was Kingfisher Airlines, the running company that borrowed. I was a guarantor. Please, there’s a big difference.”

The Reality Check: While technically accurate, this is a half-truth. Vijay Mallya was a personal guarantor for Kingfisher Airlines’ loans, a legally binding obligation to repay the debt. Both Indian and UK courts have affirmed his legal responsibility.

Allegation 3: “No Criminal Allegations Against Me”

Vijay Mallya audaciousy declares, “Have I stolen money from the banks? Have I done any money laundering? There is no other criminal allegation against me. It’s all about money.”

The Reality Check: This is demonstrably false. The Enforcement Directorate (ED) has filed a case against Mallya under the Prevention of Money Laundering Act (PMLA), a criminal offense. The ED alleges that Kingfisher Airlines diverted ₹3,547 crore from loans for other purposes, constituting money laundering. This includes:

• ₹3,432 crore laundered between April 2008 and March 2012 through inflated lease agreements for planes.
• ₹45.42 crore from SBI and PNB loans used to pay for a corporate jet, allegedly used by Vijay Mallya and his family for personal trips. When confronted, Mallya deflected, implying that other prominent figures also misuse private jets.
• ₹50.90 crore diverted to his Formula One team, Force India, for fuel, airport charges, hotels, and other operating expenses.
• ₹15.9 crore diverted to his IPL team, Royal Challengers Bangalore, through multiple accounts from an SBI loan in 2008, despite SBI’s refusal to allow such a transfer. Vijay Mallya claimed this was for Kingfisher advertisements on umpire jerseys, but SBI’s objection contradicts this.

Further allegations include:

• Pre-approval of Loans: Mallya allegedly pre-arranged loan approvals from IDBI officials even before applying, despite Kingfisher Airlines’ negative net worth and low credit rating.
• Overvaluation of Assets: Kingfisher Airlines allegedly overvalued its brand at ₹3,406 crore based on future revenue projections when seeking loans from IDBI, without disclosing this crucial detail to the bank.
• Understating Net Worth: In November 2008, United Breweries Holding, Vijay Mallya’s company, stated its value as ₹3,600 crore while acting as a corporate guarantor for Kingfisher, despite its net worth being only ₹55 crore by March 31.
• Concealing Overseas Properties: An ED chargesheet claims Mallya deliberately understated his assets when providing personal guarantees for loans during the 2010 restructuring, possessing ₹3,164 crore in assets but reporting only ₹1,395 crore. The ED alleges he has extensive undeclared properties in the UK, US, and other countries.
• Service Tax Evasion: Between 2012 and 2015, Kingfisher Airlines allegedly collected over ₹100 crore in service tax from passengers but failed to deposit it with the tax department.

Given these numerous allegations, Mallya’s claim of having no criminal charges against him is simply untrue.

Allegation 4: “Wilful Defaulter is Not a Crime”

Vijay Mallya claims, “Wilful defaulter is a person who can pay and who doesn’t pay. That’s a crime.” He then equates this to not being “theft from the bank.”

The Reality Check: A “wilful defaulter” is indeed someone who has the capacity to repay a loan but deliberately chooses not to. While not a crime in the same vein as a violent offense, it constitutes a serious financial offense that is legally actionable and can lead to criminal charges, as evidenced by the ongoing cases against Vijay Mallya. Equating it with not being “theft from the bank” is a specious argument designed to minimize the severity of his actions.

Allegation 5: “My Debt Was Only ₹6,203 Crore, Not ₹9,000 Crore”

Vijay Mallya argues that media reports exaggerate his debt, claiming he owed only ₹6,203 crore, not ₹9,000 crore, and that ₹14,000 crore has already been recovered. He cites a 2017 Debt Recovery Tribunal (DRT) order from Bengaluru to support his claim of ₹6,203 crore.

The Reality Check: While the DRT order indeed mentions ₹6,203 crore, it clearly states, “Defendants No. 1 to 4 jointly and severally shall pay a sum of Rs. 6203,35,03,879.42 (Rupees Six Thousand Two Hundred and Three Crores Thirty Five Lakhs Three Thousand Eight Hundred and Seventy Nine and Paisa Forty Two Only) with further interest at the rate of 11.5% per annum with yearly rest from the date of the application that is 25th June 2013.” This means the ₹6,203 crore is the principal amount, and significant interest has accrued since 2013. This explains the higher figure of ₹9,000 crore widely reported. While banks need to clarify the exact calculation, Mallya’s claim that his debt was solely ₹6,203 crore is misleading. The latest reports, post-podcast, indicate Mallya still owes banks approximately ₹7,000 crore.

Allegation 6: “I Made Four Settlement Offers That Banks Refused”

Vijay Mallya claims, “I made four settlement offers to the banks between 2012 to 2015… which they refused to accept.” He further states that proof of this is in Supreme Court records.

The Reality Check: Extensive research of news archives from 2012 to 2015 reveals no evidence of Mallya making any settlement offers during this period. While he did make settlement offers around 2016 (after he had already left India and was declared a fugitive), his first offer in 2016 was for only ₹4,000 crore. Mallya’s claim of having offered settlements between 2012 and 2015 lacks verifiable proof. If such records exist in the Supreme Court, as he claims, they should be made public. It was only in May 2020, during the COVID-19 pandemic, that Vijay Mallya unconditionally offered to repay 100% of the loan. This raises the question: if he wasn’t personally bankrupt by 2016, why did he not repay the full amount earlier, and only offer to settle after fleeing the country?

Allegation 7: “I Am Not a Thief Because Money Has Been Recovered”

Vijay Mallya argues, “You froze my assets in 2016… You can’t freeze assets of a person on one hand and call him a chor on the other hand. I am probably the only chor who has been called chor after repaying two and a half times.”

The Reality Check: This is a flawed argument. The recovery of stolen money or the freezing of assets does not absolve a thief of their crime. Mallya did not voluntarily repay the money; it was forcibly recovered through legal processes and asset seizures. If this logic were to hold, any economic offender could claim innocence once their ill-gotten gains are recovered. The crime lies in the act of defaulting and alleged fraud, not solely in the non-recovery of funds.

Allegation 8: “Pranab Mukherjee Told Me Not to Downsize”

Vijay Mallya claims that in 2008, after the economic recession, he approached then-Finance Minister Pranab Mukherjee to discuss downsizing Kingfisher Airlines and laying off employees. He alleges Mukherjee told him not to downsize, emphasizing the importance of connectivity and jobs, and assured him that banks would provide support.

The Reality Check: While Pranab Mukherjee is no longer alive to confirm or deny this conversation, it’s crucial to understand the role of government in private enterprise. While the government can offer advice or recommendations, it cannot dictate how a private company is run. The final decision to downsize Kingfisher Airlines rested with Mallya. This appears to be an attempt to shift blame for his business failures onto government recommendations. This pattern of claiming credit for success but blaming external factors for failure, while expecting taxpayer-funded bailouts, highlights a fundamental hypocrisy often observed in corporate billionaires.

Allegation 9: “Media Made Me a Villain”

Vijay Mallya contends that the media unfairly painted him as a villain.

The Reality Check: While it’s true that other businessmen have defaulted on loans and settled for lesser amounts without similar public scrutiny, Mallya’s lavish public persona and the stark contrast between his opulent lifestyle and the plight of his unpaid employees undeniably contributed to his public image. When he was “King of Good Times,” the media played a significant role in his rise to prominence. However, during his downfall, his actions – throwing multi-crore parties while employees starved, fleeing the country with massive debt, and dismissing an employee’s wife’s suicide as a “marital dispute” – made him the undeniable face of financial crime and moral bankruptcy.

Conclusion: The Unfinished Narrative

Vijay Mallya’s recent podcast attempts to reframe his narrative, portraying himself as a victim rather than an offender. However, a meticulous examination of his claims against a backdrop of established facts, legal proceedings, and credible news reports reveals a consistent pattern of misdirection, half-truths, and outright falsehoods. The substantial evidence of alleged money laundering, fraudulent activities, and a blatant disregard for employee welfare and financial obligations stands in stark contrast to his claims of innocence.

As the Economic Times recently reported, Mallya still owes approximately ₹7,000 crore to Indian banks. The questions surrounding his actions remain largely unanswered. Ultimately, the appropriate forum for Mallya to address these serious allegations is not a podcast, but a court of law. Until then, the narrative of Vijay Mallya remains unfinished, awaiting a definitive legal resolution.

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