MALLYA AND HIS ART OF LIVING
By Ruma Dubey
On one hand we have the very rich, extravagant Vijay Mallya and his son in tow, who seems to be the mover and sharer of the Indian social world. And then on the other hand, we have Mallya’s airline company, Kingfisher, which is today on the brink of closure. So these two images – a rich, socialite industrialist and one on the verge of collapse, just do not seem to go together. Yeh baat hazam nahi hui!
The question – is a rich industrialist, who is ‘rich’ today precisely because of the money he has earned from these companies, disassociate his personal image and life style from that of a troubled industrialist?
Sometimes, such vexing questions are put to us by the simplest of people. The chaiwallah of our office is the one who put forth this question. He said in his uncomplicated, simple way, “Arrey, how can Kingfisher be in trouble when the owner is so rich? He owns an IPL team and car racing company (read Formula One), how can he not have money to rescue his company?”
Well, Mallya surely cannot get money from home; empty his coffers to rescue his company. It is not like the chaiwallah who can bring money saved from home and put it into his chai shop. But what probably irks everyone is the fact that on one hand, Mallya follows no austerity measures, leads a swanky life style while his company’s pilots and employees have not been paid salaries and neither has he paid for the fuel.
Kingfisher owes Rs.890 crore for fuel, has a debt of Rs.7000 crore, it owes gargantuan amount of money to the Airport Authority of India for landing charges, all his aircrafts are leased and no rent has been paid on most of them. Well, he has always blamed the state of his company on high fuel prices, unsustainable low fares, and fierce competition. Lo and behold, Mallya blamed all this on Income Tax department! Mallya said the airline's bank accounts were frozen "very suddenly" by Income Tax authorities over non-payment of tax dues. "I don't deny we have taxes due, the bottom line is we requested for time to pay these dues." How is paying tax responsible for the doom of Kingfisher? He calls himself an “honest” industrialist, so how come he did not pay taxes?
More importantly, today, 5 out of the 6 airline companies are in the red. But there was a time, in 2005 when all airline companies, including Air India which posted profits yet Kingfisher, since its inception in 2001 has never ever posted gains. So is that because of the tax department again? Or is it simply because Mallya just did not get it right? Today, equating the state of his company with that of the others is not right.
Mallya, despite being at fault, managed to convince banks to restructure his mammoth debt of Rs 8,414 crore. Working out some complex mathematics formula, banks agreed to convert some Rs.750 crore of debt into equity, giving the banks a collective stake of 23% in the airline company. So someone like Mallya gets a waive off for crores of rupees of debt while people like you and me, would not get a waiver for even one single paisa. How is this fair? A flamboyant industrialist gets treated like a ‘responsible’ citizen when he has dodged taxes, not paid salaries, not paid for fuel and yet, goes around spending money on irrelevant purchases? Clearly, money power alone works in this country.
Yes, cost cutting and austerity measures are for the common man while the top notch lives life king size, the good times never seem to end. Now this is something worth screaming, “kolaveri di!”