LONDON — Vijay Mallya has spent a lifetime building a reputation as India’s professed King of Good Times, a flamboyant tycoon with investments in an airline, booze and a car racing team.
Over the last year, though, those good times have been in short supply.
And in the latest sign of his fall from grace, British police arrested Mr. Mallya on Tuesday, as part of extradition proceedings that could lead to him being sent back to India, which he fled more than a year ago under an avalanche of unpaid bills and accusations of fraud.
It is a far cry from the kinds of headlines the 61-year-old Mr. Mallya is used to making.
Often likened to the British entrepreneur Richard Branson, Mr. Mallya turned what had been a family business into a sprawling conglomerate. He now owns the United Breweries Group, which makes Kingfisher beer and distributes a wide variety of products, including alcohol, chemicals and fertilizer. He also has a stake in India’s only Formula One auto racing team, Force India.
He is also a regular presence on the party scene, drawing attention in particular for a birthday party a decade ago in which Lionel Richie was the headline act. Attendees at Mr. Mallya’s 60th birthday party, held at his villa in the coastal Indian state of Goa, included the singer Enrique Iglesias, Bollywood stars and top Indian businessmen.
“I work hard and I play hard, too,” he once said.
And like Mr. Branson, Mr. Mallya even established an airline, also called Kingfisher. Kingfisher Airlines had outsize ambitions, expanding internationally and shifting from an all-economy class model to add a luxurious business class.
He made a splash at the Paris Air Show in 2007 with a $7 billion order for 50 Airbus planes. The airline promised meals even on short-haul flights, and curbside valets. Its flight attendants even wore the bright red uniforms used by staff members on Mr. Branson’s Virgin Atlantic.
But Kingfisher Airlines struggled in a competitive domestic market, and over time it was left with a ragtag collection of aging and inefficient planes. By 2012, after persuading lenders to restructure its debt, it ceased operations in the face of high fuel prices and a global slowdown.
Kingfisher Airlines owed more than $1 billion in loans, as well other bills like back pay to former employees. Because Mr. Mallya himself, and the United Breweries Group, backed some of the loans, creditors chased them for repayment.
As the dispute went through the courts, banks tried to seize Mr. Mallya’s assets. Indian authorities raided his homes and offices in Mumbai, Bangalore and Goa in 2015.
He left for Britain in March 2016, but India canceled his passport the next month, after a court in Mumbai issued a warrant for his arrest. India sent Britain an official request for Mr. Mallya’s extradition on Feb. 8.
On Tuesday, the Metropolitan Police in London said its extradition unit had arrested Mr. Mallya “on behalf of the Indian authorities in relation to accusations of fraud.”
Mr. Mallya appeared at a London court and was then released on bail, according to Dinesh Patnaik, India’s deputy high commissioner in London. He is scheduled to appear for another hearing next month.
“The willingness of the U.K. government in bringing him to justice is something we are appreciative of,” Mr. Patnaik said.
According to the British Home Office, arrest warrants are issued in response to extradition requests only if such requests are certified by officials and then sent to a court for the warrant to be issued.
If the judge in Mr. Mallya’s extradition hearing approves the request for him to be sent back to India, then it is sent to Britain’s home secretary for final approval.
Mr. Mallya dismissed the news as “media hype,” but he confirmed on Twitter that an extradition hearing began on Tuesday.
He has previously disputed accusations that he fled India to avoid bad debts, saying on Twitter that he travels “to and from India frequently.”
“I did not flee from India and neither am I an absconder,” he added. “Rubbish.”
Santosh Kumar Gangwar, an Indian finance minister, told reporters that the country’s authorities were “ascertaining the facts and trying to find out how to bring him back to our country and start legal proceedings against him.”
“We will not spare him legally,” Mr. Gangwar said.
An earlier version of this article misstated the year that Kingfisher Airlines was founded. It was established in 2005, not after the 2008 global financial crisis.