SC rejects Vijay Mallya's FERA plea; slaps Rs10-lakh fine

The Supreme Court has rejected UB Group chairman Vijay Mallya's plea in a case pertaining to violation of the Foreign Exchange Regulation Act (FERA), dealing yet another blow to the beleaguered 'King of Good Times'.

The apex court has ruled that the Enforcement directorate was at liberty to proceed with criminal proceedings against the liquor baron for violation of foreign exchange rules.

A bench headed by Justice J S Khehar also directed Mallya to pay Rs10 lakh as costs in the case.

Mallya had moved the Supreme Court seeking to restrain the ED from initiating criminal proceedings against him.

The case pertains to an alleged payment of $2,00,000 by Mallya to London-based Benetton Formula Ltd for promotion of the Kingfisher brand abroad.

The ED wanted to question Mallya in connection with a contract signed with Benetton in December 1995.

The British firm was paid for displaying the Kingfisher logo in Formula One World Championships in London and some European countries in 1996, 1997 and 1998, it was alleged.

The money, however, was paid without prior approval from the Reserve Bank of India (RBI), in violation of the Foreign Exchange Regulation Act norms.

The SC had, earlier, issued a notice to the ED on the UB Group chief's plea against the Delhi High Court order turning down his appeal for quashing criminal proceedings in a trial court for alleged "willful" disobedience of summons issued to him by the ED.