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NCLT Issues Notices to SpiceJet in Insolvency Pleas

18 Apr 2024 , 02:43 PM

The National Company Law Tribunal (NCLT) issued notices to SpiceJet on April 18 regarding three insolvency pleas filed by aircraft lessors AWAS 36698 Ireland, AWAS 36694 Ireland, and AWAS 36695 Ireland, concerning a total default amounting to ₹77 Crore.

Senior advocate Pramod Nair, representing the lessors, emphasized that the pleas were based on a judgment from the High Court of the United Kingdom and the contractual agreement between the parties. He urged the tribunal to summon SpiceJet and solicit a response to the pleas.

Contrarily, senior advocate Krishnendu Dutta, representing SpiceJet, challenged the maintainability of the pleas. He argued that they solely relied on a foreign court's judgment rather than the contractual agreement. Dutta contended that an insolvency plea should be based on the agreement between the parties and highlighted the lessors' pursuit of the foreign decree's execution in the high court, leading to multiple forums addressing the same dispute. Additionally, he pointed out the absence of any submitted invoices detailing SpiceJet's alleged defaults.

In response, the tribunal noted that such concerns should be addressed through a written response and subsequently issued notices to SpiceJet. The NCLT instructed the airline to file its response to the pleas within two weeks and scheduled the hearing for May 30.

In 2023, three aircraft lessors and a technical services provider filed insolvency pleas against SpiceJet for non-payment of dues. While the NCLT has only issued notice on one of Aircastle's pleas, it has been encouraging SpiceJet to resolve matters with the lessors.

In a bid to clear outstanding dues, SpiceJet allocated over 48 million shares to nine aircraft lessors in August, amounting to 231 Crore, signaling efforts to resume full operations.

However, pleas by Wilmington and Willis have been rejected by the NCLT, while Aircastle's pleas are pending judgment, reflecting the ongoing legal challenges facing SpiceJet.

For feedback and suggestions, write to us at editorial@iifl.com


Related Tags

  • NCLT
  • NCLT News
  • spicejet
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