New Delhi: The lenders of the bankrupt airline Jet Airways, led by State Bank of India, have now moved to the Supreme Court, challenging the National Company Law Appellate Tribunal (NCLAT) order dated August 28.
According to a lawyer involved in the case, this new petition contests the NCLAT’s order to allow the Jalan-Kalrock Consortium (JKC) to encash a performance bank guarantee of Rs 150 crore to pay off dues amounting to Rs350 crore to the lenders. This payment is a condition precedent for the transfer of ownership of the airline to JKC.
The counsel also stated that they are likely to raise concerns about the suspected unknown sources from which JKC has paid Rs 200 crore before the Supreme Court.
The case is scheduled for a hearing on Monday before a three-judge bench led by Chief Justice DY Chandrachud. These legal challenges are likely to disrupt the revival plan for Jet Airways, which the new lenders aim to restart by 2024.
On the 4th of October, lenders had expressed during the NCLAT proceedings that the deposited money by the JKC could potentially be laundered. According to the lenders, they have filed a new application in the Mumbai branch of the National Company Law Tribunal (NCLT) concerning the source of the money paid to them by JKC. They claim that the money they received has come from ‘unknown sources,’ and JKC did not disclose the source of the funds. The lenders assert that as per the resolution plan, the money should come from JKC and from legitimate sources.
However,JKC-led consortium had said on September 29 that they had fulfilled the financial commitment of ₹350 crore and said the new promoters are determined to re-establish the operations of the airline up and running in 2024.
“Further announcements regarding the launch date of Jet Airways will now be made in the coming weeks,” it had said. JKC had paid the first instalment on August 31.
Coincidentally, former Jet promoter Naresh Goyal was brought for questioning by the Enforcement Directorate and arrested on September 1.
The JKC had completed the transfer of money to the lenders as per the NCLAT instruction. According to the payment schedules approved by the NCLAT on August 28, JKC was required to pay ₹200 crore to the lenders. The NCLAT had instructed them to pay the due amount of ₹350 crore to the lenders by September 30, with Rs150 crores to be encashed from the performance bank guarantee.
This is not the first instance of lenders flagging a flaw in JKC’s proposal. On 5 July, the Committee of Creditors had told the Supreme Court that it might be more prudent to wind up the airline, given they have not been repaid and no funds have been infused into the debt-laden airline. Lenders have infused approximately ₹400 crore of public money into the airline, which includes settling airport dues.
According to the January order by the Mumbai bench of the tribunal, the effective date of the resolution plan was taken as 16 November. As a result, the consortium has six months from the said date to make payments to lenders.
On 22 June 2021, the NCLT in its order approved the resolution plan for Jet Airways submitted by the Jalan-Kalrock consortium. The consortium comprises UAE-based non-resident Indian Murari Lal Jalan, who will hold shares in Jet Airways in his personal capacity, and Florian Fritsch who will hold shares through his investment holding company Kalrock Capital Partners Ltd, Cayman.
Jet Airways stopped flying in April 2019 after running into financial difficulties. However, ownership transfer has been hanging fire amid continuing differences between the lenders and the consortium.
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Updated: 09 Oct 2023, 01:40 AM IST