Diageo may reduce settlement payout to Vijay Mallya on 'improper transactions' charges

Diageo may reduce settlement payout to Vijay Mallya on 'improper transactions' charges

Zee Media Bureau 

Mumbai: The saga of USL investigating into the 'improper transaction' worth Rs 1,225.3 crore allegedly conducted by Vijay Mallya may have a bearing on the settlement money due to receive from Diageo Plc.

The UK -based liquor major Diageo Plc was to pay Rs $75-million severance package to Mallya in order to quit United Spirits Ltd. Economic Times reported that after the revelations of the diversion of funds from USL coming to light, Diageo Plc may reduce Mallya's settlement amount.

Diageo, who makes McDowell's No.1 and Royal Challenge said on Saturday that an internal probe found the funds had been diverted between October 2010 and July 2014.

The paper reported that the overseas beneficiaries or recipients include more than half-a-dozen entities such as Force India Formula One, Watson Ltd, Continental Administrative Services, Modall Securities, Ultra Dynamix and Lombard Wall Corporate Services — in each of which Mallya has direct or indirect interest. The Indian beneficiary was mostly Kingfisher Airlines.

USL may also lay claim to Mallya's stake in the Force India Formula One team as security until it recovers the funds used by him, the paper added.

A complaint of criminal breach against Mallya and others is to be filed with the Bengaluru police on Monday and the corporate affairs ministry's Serious Fraud Investigation Office will be apprised of the findings. These will also be reported to Enforcement Directorate for any possible forex violations.

The Securities & Exchange Board of India (Sebi) has taken cognisance of USL's findings as reported. Vijay Mallya has denied all allegations of wrongdoing.

The Debt Recovery Tribunal (DRT), in March, had ordered Diageo plc not to pay Mallya the $75 million as a severance package to quit its Indian arm United Spirits Ltd till the case against him was settled.