Air Sahara on Wednesday night said it would run the airline with its own management if the deal with Jet Airways, which has agreed to buy it, did not materialise by midnight.
However, Sahara indicated it was open to extending the deadline for the transaction.
"We had made an offer for a possible extension of 15 days deadline, which is still available with Jet. Moreover, our offer of four members on the board is also available," Air Sahara president Alok Sharma told reporters in New Delhi.
Jet had demanded appointment of five members on the board of Air Sahara.
While four had been secured official clearance, that of Naresh Goyal is still pending with the government.
He, however, said that Sahara has not heard from Jet.
Asked what was the reason for the delay, he said regulatory approvals had held back the completion of the deal.
"If there is no choice, then we will terminate on technical grounds," Sharma said.
On whether Air Sahara's counsel had submitted before the Lucknow court that Jet has terminated the deal, he declined to comment, saying the matter was sub-judice.
"We have moved the Lucknow court, seeking to restrain Jet Airways to operate the escrow account, which currently has Rs 1,500 crore," Sharma said.