The airline Jet Airways, affected by the crisis, was already closed. Now the Supreme Court has ordered his properties to be sold. Today, that is, on November 7, the Supreme Court has ordered the liquidation of this troubled airline, that is, the sale of its assets. The Supreme Court of the country rejected the decision of the National Company Law Appellate Tribunal (NCLAT) in this regard.
NCLAT had decided to transfer ownership rights of Jet Airways to Jalan-Kalrock Consortium (JKC) as per the approved resolution plan. However, the SBI and other creditors had filed a petition in the Supreme Court against this decision. The Supreme Court struck down the consortium’s proposed resolution plan to get Jet Airways back on track and said the consortium could not even pay the first installment within the stipulated time.
The three-judge court gave its verdict
The Supreme Court had reserved this decision on October 16 and it was pronounced by a three-judge bench headed by Chief Justice DY Chandrachud. The bank guarantee of Rs 150 million given by Jalan Kalrock was also seized.
The airline closed in 2019.
Jet Airways closed in the year 2019 due to financial crises. The largest lender, SBI, had initiated insolvency proceedings in NCLT Mumbai and after this the resolution process of the company was initiated. Jalan-Kalrock had bid for it in 2021. However, the matter progressed so far that it reached the Supreme Court.
On March 12, on the order of the Supreme Court, the NCLAT had confirmed the decision to transfer the ownership of Jet Airways to JKC, while even earlier, the NCLT had given permission in January to transfer the ownership to JKC and had asked the Lenders must take possession of the property within 90 days. Transfer is ordered. After this, the matter again reached the Supreme Court where the SBI-led Committee of Creditors said that the plan presented to get Jet Airways back on track is not correct according to the lenders. He challenged the NCLAT order confirming the resolution plan.
Claim of 350 million rupees
The consortium had promised an equity investment of Rs 350 crore to acquire ownership of Jet Airways under the resolution plan. A three-member NCLAT bench had approved adjusting the bank guarantee of Rs 150 crore from this. The lenders also alleged that they had been continuously paying airport charges and other expenses at the rate of Rs 22 million every month, and had so far spent more than Rs 350 million. Senior advocate Harish Salve before the Supreme Court, representing the lenders, submitted that an airline needs at least 20 aircraft, while the consortium has procured only five aircraft.
On the other hand, senior advocate Mukul Rohatgi, appearing for Jalan-Kalrock, vehemently denied all the allegations. He said the consortium did not avail the lenders’ offer because it had to pay Rs 350 million anyway. When the consortium filed its claim on Jet Airways, the Committee of Creditors (CoC) had petitioned the Supreme Court for the liquidation of Jet Airways, following which this decision came from the Supreme Court.
