Mallya has been on bail on an extradition warrant since his arrest in April a year ago and is fighting extradition to India on charges of fraud and money laundering amounting to around Rs 9,000 crores.
Former Union finance minister Yashwant Sinha, who recently left the BJP and is now in the Opposition camp, said: "Not only the finance minister, the entire BJP must come clean on its relations with Vijay Mallya".
Screenshots were in circulation of the June 12, 2018, tweet in which he had said: "Mallya could not escape from India because of a strong Look Out Notice for him at airports".
The statement from the Finance Minister came minutes after Mallya claimed that met Jaitley before fleeing out of the country and offered to settle the amount he owed to the banks. "That is the truth", he responded.
In 2016, Arun Jaitley had said that there is a legal process to stop somebody from going overseas. When Mallya was asked about Rahul Gandhi's statements that he had been allowed to flee, he said that he was not tipped off by anyone.
Rubbishing his claims, Arun Jaitley in his Facebook blog said, "He (Mallya) paced up to catch up with me and while walking uttered a sentence that "I am making an offer of settlement".
Later, he clarified there was no formal meeting, and his words were blown out of proportion.
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"This is a totally unnecessary controversy created by friends in the media".
Terming Mallya's offer to settle overdue loans of more than Rs 9,000 crore to his now-defunct Kingfisher Airlines as "bluff offers", Jaitley said he did not even take the papers the liquor baron was carrying during that brief encounter. "The banks had filed objections to my settlement letters", he had said.
"I put nearly Rs 15,000 crore offer on the table of the Karnataka High Court". Indian authorities wouldn't have been in a situation to endlessly wait outside United Kingdom court rooms to get a favourable judgment for Mallya's extradition and even make a presentation to United Kingdom judges about the facilities an conditions of Indian jails.
"I am a scapegoat". As far as I am concerned, I have made a comprehensive settlement offer before the Karnataka High Court. Also, if he felt a declared defaulter of bank loans to the tune of thousands of crores was trying to use his privilege as a Rajya Sabha MP to influence a cabinet minister, he ought to have informed the House about it or shared the information with the media.
During the hearing, Mallya's defence team branded the evidence presented by the Indian government in the case as "utterly unfounded".
Claire Montgomery, representing Mallya, reiterated that the prosecution had failed to make out a case against her client.
The bench of Emma Arbuthnot is likely to take a final call on handing over Mallya to Indian authorities after reviewing the video on Barrack 12 of Arthur Road jail in Mumbai.