Government annuls Mallya's selection as Kingfisher MD

Government annuls Mallya's selection as Kingfisher MD

In a double blow to the tottering fortunes of flamboyant UB Group chairman Vijay Mallya, the government on Monday annulled his reappointment as managing director of Kingfisher Airlines. Mallya also quit from the board of another group company Mangalore Chemicals and Fertilizers Ltd (MCFL).

The Ministry of Corporate Affairs rejected the application made by Kingfisher under Section 269 of the Companies Act, 1956, for the government’s approval for reappointment of Mallya as MD of the airline for five years starting October 16, 2013, without remuneration.

According to government sources, the decision was taken because Kingfisher failed to get necessary regulatory approvals from its lenders and shareholders for the reappointment.

Reacting to the development, Ammeet K Agarwal, president and CEO of Mumbai-based Supreme Aviation, said the decision taken by the government is a right message for the aviation fraternity. 

“Mallya could have better managed Kingfisher’s affairs, but he took everything lightly and has faced the consequences. The decision signals the need for a new era of probity in corporate India and the need for ensuring accountability by businessmen when it comes to paying up their dues and handling employee issues with compassion and sensitivity,” Agarwal said.

The developments come on the heels of minority shareholders of United Spirits, a prized entity of the Mallya-led UB group, coming under scrutiny over financial dealings of the company with entities connected to Mallya.

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