Kingfisher Probe Extends To Finance Ministry Officials


New Delhi: The Central Bureau of Investigation (CBI) is seeking documents from the finance ministry as it seeks to widen its probe related to loans extended to Vijay Mallya’s Kingfisher Airlines to include the role of government officials as well as other lenders, who were part of the consortium, which controversially bailed out the now defunct carrier.

Sources in the agency confirmed that the scope of the probe has been widened to include the role of all those who tried to reach undue benefits to the grounded airline at the cost of public exchequer. The investigating agency has made arrests of four functionaries each of the IDBI Bank and Mallya’s ill-fated aviation venture. Sources said besides government officials, role of other banks apart from IDBI is also under the scanner.

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The development came as it emerged that several mails and letters were exchanged between the Congress-led UPA and Mallya who had sought the intervention of former PM Manmohan Singh and the then finance minister P Chidambaram in reworking the airline’s stressed finances. The expanded probe will examine the claim of bankers that they acted at the instance of the government of the day, with instructions from key functionaries. Kingfisher Airlines had debt of over Rs 7,000 crore and its finances were in shambles since 2008-09 till it finally downed shutters

BJP used the documents pointing to UPA’s effort to help the airlines stay afloat as it attempted to turn the tables on Congress, which had accused the government of helping Mallya “escape” to London. The ruling party alleged that Singh and Chidambaram facilitated Mallya and Kingfisher in borrowing huge sums from the public sector banks even when banks were reluctant to lend and had even frozen some of the accounts.

“PM Manmohan Singh should answer as to how he sought help from banks for a specific company… Letters reveal the PMO (under Singh) had turned a PR firm for a specific company. But Congress leaders have no answer,” power minister Piyush Goyal said at a press conference. In an October 4, 2011, letter that Mallya wrote to Singh, the businessman refers to a meeting with the then PM and listed out his demands — from allowing foreign airlines to buy into Indian carriers to high taxes on aviation fuel — while also referring to State Bank of India providing additional loans of Rs 550 crore. A few months later, he sought Singh’s intervention again for “support” a lenders consortium led by SBI.

On March 21, 2013, in a letter to Chidambaram, Mallya sought his intervention as SBI had turned down a request to grant it clearance for selling stake in his flagship United Spirits to global giant Diageo and the bank’s deputy managing director Shyamal Acharya’s refusal to meet him. While