How did Vijay Mallya end up being a Fugitive Economic Offender? - Seeker's Thoughts

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How did Vijay Mallya end up being a Fugitive Economic Offender?

Vijaya Mallya has been constant in news for being a wilful defaulter and running away without paying 9000 Crore of Indian Rupees. The Enforcement Directorate which looks after economic crimes done in India has declared Vijaya Mallya as Fugitive Economic Offender. Since 2016, Vijay Mallya refuged meeting with ED. He denied coming to India and wanted to be only available to video call.




Enforcement Directorate had to go through the written procedure in the past. The agency issued three summons and waited for weeks in 2016. Later on, a court order was issued, and Mallya's diplomatic passport was held. After a series of events which put pressure on Vijay Mallya, he eventually tweeted for repayment of 100 percent principal amount but the deal remained the same. He wanted to pay only the ‘principal amount’ without interest.
The Constant Rejection
Vijay Mallya has approached in November 2018 to a Special Prevention Money Laundering Act (PMLA) Court against the Enforcement Directorate’s application to declare him as a fugitive. The application was rejected by PMLA court. Later on, he went to the Apex court, which once rejected Mallya’s plea. On 5th January 2019, a special court in Mumbai declared Vijay Mallya a fugitive economic offender or FEO on a plea of Enforcement Directorate. Therefore, he became the first businessman to be declared as FEO under the provisions of new Fugitive Economic Offender Act. 
Did Mallya really intend to pay?
At the end of the year 2018, there were tweets from Mallya’s twitter account that he wanted to pay 100 per cent Principal amount since 2016 but Indian authorities did not intend to make any settlement.
In 2016, Mallya had submitted  the offer in Supreme Court for settlement in 6 Months. There is a consortium of Banks, and not a single bank involved which had lent money to Mallya, and State Bank of India was the biggest lender.
Why did not banks accept the deal of Mallya?
Before addressing or agreeing to any proposal bank needed to consider few factors like-  the timeline of payment and the mode of repayment. The Union Bank of India was the first to speak against Vijay Mallya. However, there remains a curiosity, that if he was intending to pay the principal amount, why was not it accepted?
Accepting the offer will signal other willful offenders to negotiate according to their preferences, which will give more strain to already struggling banks. The Indian banking sector has huge NPA’s burden. 
Banks have to be very cautious about it. It's not a 50 per cent discount offer, banks have to recover a cost. Banks have to pay the money to the depositors- who are often common people of India. Who is going to pay the other part of the money and the loss which was created by the borrower?
Commercial decisions of banks have to be taken in commercial manners.
Part of lender of consortium can agree with the offer but criminal and other aspects are also involved against Mallya. The case has to be seen in the way of totality, not in the willingness of payment.
The middle class population who gets EMI, does not get such deal. Ordinary citizens have to pay what has been asked to pay, therefore, accepting the proposal of Mallya is going to bring political chaos.
Banks don't have a choice?
Do banks need to cut their losses? How about social impact? For sure, the society is not going to take this 'acceptance of the offer' in a very positive manner. That's why bank did not agree with the offer of a willful defaulter.