Lenders of bankrupt airline Jet Airways, led by the State Bank of India (SBI), on Thursday told the Supreme Court that successful bidder Jalan Kalrock Consortium (JKC) was “unwilling” to pay the dues and that the “liquidation” was the only option left.
The bench led by Chief Justice of India (CJI) DY Chandrachud was hearing the SBI-led consortium plea against the NCLAT’s March order upholding ownership transfer of the bankrupt airline to JKC.
"Enough is enough. They can’t play with the law. Liquidation is the only option remaining,” Additional Solicitor General (ASG) N Venkataraman said.
SBI told the court that the total admitted claim of the financial creditor is close to Rs 7,800 crore and the financial package offered by the SRA (Successful Resolution Applicant, that is, JKC) in the Resolution Plan was Rs 4,783 crore, which is payable in tranches in five years.
The first tranche payment of Rs 350 crore was required to be made by March 21, 2022.
This amount has not been paid to date despite several extensions and exclusions granted to the SRA by the NCLT, NCLAT, and SC.
“We are struggling for the first tranche of Rs 350 crore.
"The resolution plan is effective for 180 days.
"Lenders are incurring Rs 22 crore every month to maintain the Corporate Debtor (Jet Airways),” the ASG said.
He had also told the court earlier that even the NCLAT’s order directing the SRA (to belatedly) create security by mortgaging Dubai properties within 30 days of its order, has not been complied with.
Meanwhile, senior advocate Mukul Rohatgi, appearing for JKC, the successful bidder for bankrupt Jet Airways, alleged in the Supreme Court that the SBI brought down Air India and Kingfisher airlines.
“They have brought down Air India, Kingfisher.
"Ten separate pleas have been filed by them (SBI) against airlines.
"Only two airlines are left. They will bring down everything. No airline will remain,” Rohatgi alleged in the court.
JKC told the court that the lenders do not "give them the key” to access their grounded aircraft on the airport premises.
The apex court will now hear the arguments by JKC on Tuesday.
The National Company Law Appellate Tribunal (NCLAT) had on March 12 greenlit the transfer of ownership of Jet Airways to JKC.
NCLAT had told JKC to obtain an air operator’s certificate within 90 days from March 12.
It had also given it more time to pay Rs 175 crore to SBI as 107 days had passed since NCLAT's order allowing the transfer of ownership.
It upheld the order of the National Company Law Tribunal (NCLT), which had permitted the transfer of ownership to JKC in January last year. Consequently, the appeal by the SBI against the takeover of the airline by JKC was dismissed.
The lenders then appealed against this order in the Supreme Court.
Among the airlines in India, Go First had filed for voluntary insolvency on May 2, 2023, under Section 10 of the IBC, and on May 10, 2023, and the NCLT admitted its insolvency plea.
The grounded airline joined the ranks of major carriers such as Kingfisher Airlines and Jet Airways, which went to the wall in 2012 and 2019, respectively, underscoring the challenges inherent in navigating India’s aviation industry.
On the other hand, the Tatas took over Air India on January 27, 2022 and chose SBI, Bank of Baroda and HDFC Bank as preferred bankers for the airline.
On February 29, 2024, Air India refinanced short-term loans with the SBI and Bank of Baroda (BoB) for a three-year loan, replacing the short-term Rs 18,000 crore bridge loan Air India had availed from SBI and BoB to complete the Tata group's takeover of the national carrier in January 2022.
