The Enforcement Directorate (ED) in its affidavit filed in a UK court has claimed that Vijay Mallya — who was arrested on Tuesday in London — had laundered around Rs 500 crore of the Rs 900 crore loan he took from IDBI Bank in India.
According to the economic intelligence agency, Mallya diverted the loan money to at least seven countries, including the US, the UK, France, Switzerland and Ireland. The affidavit provides complete money-trail details.
The affidavit suggests that he used several shell companies and some of his legitimate companies besides Kingfisher Airlines to divert the money by generating fake invoices or through over-invoicing of products, the Times of India reported.
Not just that, but Mallya had also appointed dummy directors in the shell companies, while he would control and look after any business-related fund transfers.
In addition to the probe, Britain's Serious Fraud Office (SFO) has found that the current residence of Mallya in London known as the Lady Walk was bought using money he borrowed from the Indian banks and then routed through companies located in the UK.
The SFO has shared the details with the Central Bureau of Investigation (CBI), according to a report by India Today.
According to an official, the prosecutors in London now have everything they need to prove criminality of Vijay Mallya.
"Now, our extradition case will be heard along with CBI's extradition proceedings in the Westminster court in December," said an ED officer.
Extradition is the act by one jurisdiction of delivering a person who has been accused of committing a crime in another jurisdiction. The Ministry of External Affairs (MEA) takes up extradition requests with the concerned foreign countries when a request for extradition is received from the relevant law enforcement agencies in India.
Reports last month suggested both the CBI and the ED believed Mallya had diverted most of the Rs 6,000 crore borrowed from banks to shell companies.
Both agencies said evidence gathered would strengthen their case for Mallya's extradition from the UK.
The nation's biggest public sector bank, the State Bank of India, is the leader of the consortium of 17 banks to whom Mallya owes over Rs 9,000 crore.
Liquor baron Mallya had left the country in March 2016 after public sector banks claimed he was a loan defaulter and owed an estimated amount of Rs 9,091 crore. They had also approached the Debt Recovery Tribunal.
Mallya was arrested in London on Tuesday, but was granted bail shortly after being produced before the Westminster Magistrates' Court for a hearing.
"I deny all allegations that have been made and I will continue to deny them. I have not eluded any court. I've given enough evidence to prove my case," Mallya said outside the court after the hearing.
Mallya, who was also a member of the Rajya Sabha, left the Indian shores about six days before the banks approached the court.
The fight between Mallya and the CBI and ED is expected to get intense in the future and bringing him back could be a tough job. Both the agencies are, however, hoping they will get him in the December 4 hearing.