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Mallya jet: Service Tax Dept weighs another round of auction

In its bid to recover around Rs 535 crore dues from Mallya, the Service Tax Department had conducted the e-auction of his personal plane for the third time on November 28-29. It has already conducted two such auctions in June and August respectively, but to no avail.
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Nov 30, 2016, 08.05 PM | Source: PTI

Mallya jet: Service Tax Dept weighs another round of auction

In its bid to recover around Rs 535 crore dues from Mallya, the Service Tax Department had conducted the e-auction of his personal plane for the third time on November 28-29. It has already conducted two such auctions in June and August respectively, but to no avail.

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Mallya jet: Service Tax Dept weighs another round of auction

In its bid to recover around Rs 535 crore dues from Mallya, the Service Tax Department had conducted the e-auction of his personal plane for the third time on November 28-29. It has already conducted two such auctions in June and August respectively, but to no avail.

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Mallya jet: Service Tax Dept weighs another round of auction
Unable to get the right price in the recently-held third auction of luxury personal jet of the embattled businessman Vijay Mallya, the Service Tax Department is now planning to go for yet another round in the next couple of months, a senior department official said.

In its bid to recover around Rs 535 crore dues from Mallya, the Service Tax Department had conducted the e-auction of his personal plane for the third time on November 28-29. It has already conducted two such auctions in June and August respectively, but to no avail.

However, the bid price offered by the single bidder, the US-based firm AMS, was much lower than that of the reserve price which had been fixed by the department. It was despite the fact that the department had lowered the reserve price of the plane this time.

"The bid price offered by the single bidder AMS for Mallya's plane in the auction which was conducted by MSTC on behalf of the department on November 28-29 was at USD 2.6 million (Rs 18 crore) which was much less than the reserve price at USD 12.5 million," a senior official of the department told PTI here today.

"Hence, the department is planning to go for yet another round of auction within the next couple of months," he added.

The joint pricing committee of the department had lowered the reserve price of the plane to USD 12.5 million this time from the earlier reserve price at USD 22.5 million.

The e-auction was carried out by MSTC after the department had roped in a professional valuer for revaluation of the aircraft following a recent Bombay High Court order to do so at a reduced reserve price.

The highest bid received by the department at the second auction held in August was a measly Rs 27 crore against the reserve price of Rs 152 crore which was offered by a domestic firm SGI Commex.

At the first auction held in June, only one bidder -- UAE-based aviation support firm Alna Aero Distributional Finance Holdings -- had participated and made an offer of Rs 1.09 crore for the jet.

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