Just in: Embattled Indian tycoon Vijay Mallya's UB Group has denied allegations that it used Rs 430 crore of bank loans to now-defunct Kingfisher Airlines to buy property overseas.  Kingfisher has now moved court saying the ED's contention is false.

Mallya, a liquor baron and lawmaker, has been at an unknown location since March 2 after Kingfisher's creditors stepped up pressure to recover the $1.4 billion they are owed.

The Enforcement Directorate made the money-laundering allegation against UB Group before a court, and has sought a non-bailable warrant against Mallya, a UB Group spokesman said in a statement late on Sunday.

"The audited accounts of Kingfisher Airlines including for the year ended (March 2010) show all foreign exchange transactions which includes funds borrowed from IDBI Bank used for legitimate business purposes only," the spokesman said, calling the basis of the warrant against Mallya "erroneous and unjustified".


State-run IDBI Bank is one of Kingfisher's more than a dozen creditor banks.