Vijay Mallya -- Rs 9,000 crore Kingfisher loan default; first Fugitive Economic Offender; banks recover Rs 14,131 crore; extradition from UK stalled since 2021

Sector: BANKING | Amount: Rs 9,000 crore | Period: 2005–2016 | Accused: 12 | Convicted: 0

Investigating agencies: CBI, ED, DRT, SFIO

Kingfisher Airlines (KFA), promoted by liquor baron Vijay Mallya, accumulated loans of over Rs 9,000 crore from a 17-bank consortium led by SBI between 2005 and 2011. When the airline repeatedly failed to meet repayment obligations, banks restructured the debt under a Corporate Debt Restructuring (CDR) scheme in 2011, converting part of the debt to equity -- giving lenders a 23.37% stake in KFA. The airline ceased all operations in October 2012 and the DGCA cancelled its licence in December 2012. Banks began declaring Mallya and KFA wilful defaulters from 2013 onwards. CBI and ED registered separate cases: CBI for criminal conspiracy and cheating under IPC Sections 120B, 420, and 406; ED under PMLA for laundering loan proceeds into overseas properties and accounts. Mallya left India on 2 March 2016, days after appearing before CBI. He was arrested in London on 18 April 2017 on India's extradition request. UK courts approved extradition at every level -- Westminster Magistrate Court (2018), UK High Court (2020), UK Supreme Court dismissed final appeal (July 2021). However, as of 2025 the UK Home Office has blocked physical extradition citing an unresolved personal legal matter, widely believed to be a confidential asylum or human rights claim. PM Modi raised the matter with UK PM Keir Starmer during bilateral trade talks in 2025. In June 2024, a special CBI court issued a fresh non-bailable warrant in a separate Rs 180 crore Indian Overseas Bank loan default case. Former IDBI Bank GM Buddhadev Dasgupta was named in a supplementary CBI chargesheet in March 2023 for allegedly conspiring to sanction loans. ED attached assets worth Rs 6,630 crore from Mallya and Rs 1,441 crore from associates; liquidation of these assets has returned Rs 14,131.6 crore to public sector banks -- exceeding the principal amount. In December 2024, Finance Minister Nirmala Sitharaman cited this recovery in Parliament as a success of the FEO framework.

Key facts

Sources

All facts are sourced. Accused means charged, not convicted.