The case can still close in favour of the banks if the government insists that Mallya is capable of paying back the banks, said Shailesh Haribhakti of Desai-Haribhakti Group.
India will now present a case in the UK court over the extradition of liquor baron and former Kingfisher boss Vijay Mallya, a top finance ministry official said on Tuesday.
"Now in the court, the Indian authorities have to present a case for extradition and it is judicially tried," the official said.
The extradition arrest was with regard to the Rs 950 crore exposure that Mallya had in IDBI Bank.
"The extradition procedure is that there must be an offence in India, some countries follow the principle of dual criminality...in the requesting state and the requested state," the official explained, adding that after a warrant is issued, depending on the nature of the case, the court decides whether to give bail or not.
Mallya was granted bail earlier during the day as this was a "monetary offence". However, the bail will have some conditions, the official said.
Past experience shows that there is a 50:50 chance of Mallya's extradition taking place, said Shailesh Haribhakti of Desai-Haribhakti Group. This case can still close in favour of the banks, if the government insists that he is capable of paying back the banks, he added.
However, since Mallya had earlier agreed to pay the principal amount that he owed to the banks, he may not be considered a wilful defaulter by UK authorities and the banks' claims of being cheated may fall flat, said Satish Maneshinde, a senior criminal lawyer.
"I don’t believe banks’ claims of being cheated will stand the test of scrutiny of law in the UK," added Maneshinde.
Maneshinde also added that Mallya has accounted for every penny that was given to him and has not diverted any money to his personal account.
"It will be quite a herculean task for the government to get him back to India," he said.This may be the first in a series of steps to get Mallya back to India, said Ramesh Vaidyanathan, Managing Partner, Advaya Legal. He added that the charge of fraud is an extraditable offence in the India-UK treaty and said the entire process can take up to 18-24 months.