Airbus asked to pay Rs 192.51 crore for Vijay Mallya’s planes

SAN FRANCISCO (Diya TV) — India’s Debt Recovery Tribunal Tuesday issued a deposit price of Rs 192.51 crore to aircraft manufacturer Airbus, a pre-delivery payment the tribunal are seeking for the company’s purchase of VIjay Mallya’s grounded fleet of planes from the now defunct Kingfisher Airlines.

Passing orders on an amended plea filed by the consortium led by the Oriental Bank of Commerce for recovery of the payment, DRT Presiding Officer K Srinivasan directed Airbus to deposit Rs 192.51 crore from any source within eight weeks. The Oriental Bank of Commerce, Corporation Bank and United Bank of India, had submitted that they made a pre-delivery payment of Rs 192.51 crore to Airbus on behalf of Kingfisher Airlines after both parties had signed a purchase agreement in 2005. But the planes were not delivered.

Since Airbus previously failed to repay the pre-delivery payment, the consortium made GoAir and Indigo as parties in the case by filing applications under garnishee proceedings to recover the money. It had sought a direction to the budget carriers to deposit the money to be paid by them to Airbus with it, under garnishee proceedings.

A garnishment is a tool for getting a monetary judgement against a defendant by ordering a third party (the garnishee) to pay the money, otherwise owed to the defendant, directly to the plaintiff. However, during the hearing of the prayer, the budget carriers had opposed it saying it would affect the interest of their business and economy.

Airbus has objected to the proceedings, saying the company was needlessly being dragged into the matter as it was neither a borrower nor a defaulter and questioned the DRT’s jurisdiction. In response, the banks’ counsel Mohammad Ibrahim had contended that the tribunal had jurisdictional power to adjudicate the matter since the contract was signed in India between banks, Kingfisher Airlines and Airbus, and the aircraft were to be delivered in India and the money was paid in India.