A tribunal today temporarily halted a Rs. 515 crores settlement to be paid by spirits giant Diageo to liquor baron Vijay Mallya, after he resigned as chairman of Diageo unit United Spirits.
The court - the Debt Recovery Tribunal (DRT) - ruled in favour of a group of creditor banks, owed money by Mr Mallya's now-defunct Kingfisher Airlines, and who had argued they had the "first right" to the 515 crores exit payment from Diageo.
Kingfisher, which stopped flying more than three years ago, had $1.4 billion or 9,400 crores in debts as of September 2013, according to corporate filings from the time.
Mr Mallya said in a statement on Sunday that he is in talks with a group of 17 banks for a one-time settlement of Kingfisher's debt, adding that he has no plans to run away from his creditors.
His considerable troubles are expanding quickly - a money-laundering case was filed against him today by the Enforcement Directorate for allegedly sending abroad 900 crores that he borrowed from a bank.
The tribunal's decision is based on a petition by the State Bank of India or SBI, which is owed Rs 1,600 crores by Kingfisher. SBI has also asked the Karnataka High Court to arrest Mr Mallya, 60, and to suspend his passport.
In 2012, Mr Mallya sold United Spirits to Britain's Diageo; after months of acrimony, he agreed last month to give up his chairmanship and board position at India's top spirits company.