CHRIS THOMSON

Plans to liquidate a $2.7 million yacht bought for Radhika Oswal just before receivers assumed control of Burrup Fertilisers from her billionaire husband Pankaj have been thrown out of the Federal Court.

PPB Advisory was appointed receiver to Perth-based Burrup on December 17 last year.

Seven weeks before that, Mr Oswal authorised Burrup’s purchase of a luxury yacht for $2.71 million, a written Federal Court ruling handed down yesterday by Justice Neil McKerracher reveals.

The same month the receiver took control of Burrup, the Oswals departed Perth for their native India. They now live in Dubai.

Before Justice McKerracher, PPB claimed an interest in the yacht. The company asserted the vessel was rapidly deteriorating due to lack of maintenance.

However, a firm owned and directed by Mrs Oswal claimed to own the yacht, and furnished photographs that showed no significant deterioration.

PPB contended Burrup funds were used improperly to buy the vessel and that Mrs Oswal’s company paid nothing for it.

The receiver argued the moored yacht could decay and its value be slashed ahead of any win PPB might have in its legal battle to reclaim more than $200 million from the Oswals.

On discovering the yacht was uninsured, PPB insured it for the period September 23, 2011 to December 23, 2011 (today).

PPB is also paying $22,000 a year for pen fees.

The yacht’s manufacturer has told PPB that a service costing $10,000 must be done immediately and repeated four times a year.

Justice McKerracher found the quality of evidence in relation to the yacht’s deterioration to be “a little sketchy”.

“I think it is appropriate that orders be made permitting the receivers to have access to the yacht to carry out maintenance work at their own expense pending the outcome of the claim,” he concluded.

“Obviously, if the claim ultimately succeeds, the expenses should be reimbursed.”

Justice McKerracher dismissed PPB’s application and ordered the company to pay legal costs.