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Finally, service tax dept sells fraudster Mallya’s luxury jet for Rs 34.8 crore

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Finally, after four aborted attempts, since March 2016, liquor baron and runaway businessman Vijay Mallya’s confiscated luxury jet found a buyer. Bidding for the jet – parked at a hangar of the Mumbai airport since its confiscation in 2013 by the service tax authorities – Florida-based Aviation Management Sales emerged to be the highest bidder with Rs 34.8 crore (USD 5.05 million) last Friday.

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The service tax authorities had put Mallya’s luxury A319 jet for bidding in an attempt to recover their dues which tunes to Rs 800 crores. This is the amount that was accumulated due Mallya’s non-payment of service tax by his previous luxury airline firm, Kingfisher Airlines, went belly up in October 2012.

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Though the transaction was completed through e-auction last Friday, the deal will have to go through only after the Bombay High Court approval, said a source on anonymity.  “Mallya’s private luxury jet has finally found a buyer at an e-auction conducted by the state-run auctioneer MSTC last Friday. The Florida-, US-based firm Aviation Management Sales LLC quoted the highest bid of Rs 34.8 crore and won the bid,” the source added.

In the first bid in March 2016, the department had fixed the rate for Rs 152 crore, but the only bidder whom turned up, quoted a meagre Rs 1.09 crore, which forced the department to reject the bid. The price dropped subsequently in the next bids and came down to USD 12.5 million from USD 22.5 million initially.

With the plane been occupying space at the highly congested Mumbai airport, the Bombay High Court directed the official liquidator of the Karnataka High Court in January 2018 to take required steps and the last unsuccessful bidding was conducted by MSTC in March 2017.

ALSO READ: Vijay Mallya looks to rid self of Fugitive Economic Offenders Ordinance

According to reports, the service tax department claiming tax dues of over Rs 800 crore from the beleaguered businessman Mallya was handed over the jet by the court to recover money in December 2013. But, the department was forced to open bidding for the plane after the Mumbai airport operator MIAL moved the Bombay High Court, requesting for a solution to remove the plane as it has captured a productive space in one of the busiest airports in India.

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