Supreme Court Accepts Plea Against Jet Airways Ownership Transfer

Lenders to Jet Airways, led by the State Bank of India (SBI) earlier filed a plea in the Supreme Court against the NCLAT order allowing the airline ownership transfer to Jalan-Kalrock Consortium within a period of 90 days. Supreme Court deemed this NCLAT judgment as shocking and unacceptable.

Jet Airways: Supreme Court Steps In Again

In January 2023, the NCLT approved Jet Airways ownership transfer to Jalan-Kalrock Consortium (JKC), the winning bidder. Since then, more than 15 months have passed, but the airline has not been transferred to the new owners.

Last month, the National Company Law Appellate Tribunal (NCLAT) directed the lenders to transfer the airline ownership to JKC in the next 90 days. It also directed the consortium to complete some formalities including securing three immovable properties in Dubai.

Banks filed a petition in the Supreme Court against this NCLAT order, requesting its intervention. Now, the Supreme Court has accepted the plea and will further examine the appeal.

Shocking NCLAT Order

During the hearing, the Supreme Court termed the NCLAT order as shocking and unacceptable. Earlier, the Supreme Court ordered JKC to provide a Performance Bank Guarantee (PBG) of Rs 150 crore. This NCLAT order is overturning the SC order. Counsel from SBI said that we have to recover Rs 4,400 crore from the new owners, and they are reluctant to pay even Rs 300 crore.

Mukul Rohatgi was the counsel representing Jalan-Kalrock Consortium. He said that words like shocking and unacceptable should not be used against a court order. The hearing on this matter will proceed on the next scheduled date, which is April 26th.

In general, the revival of Jet Airways seems like a roller-coaster ride. Some judgments by banks give us hope that the airline will finally revive. But the Indian judiciary and delays are best friends. This also highlights the loopholes in our insolvency process. The new owner- JKC is representing itself at three different forums- NCLT, NCLAT, and Supreme Court. One positive judgment of a forum is overturned by another one and this cycle continues.

NCLAT Order Had Hopes

In the NCLAT order, the appellate tribunal directed the lenders to transfer the airline ownership to the Jalan-Kalrock Consortium within 90 days. It also asked JKC to obtain an Air Operator Certificate (AOC) from DGCA to commence operations.

It directed JKC to secure three immovable properties in the United Arab Emirates. NCLAT also allowed the consortium to pay Rs 150 crore payment using the Performance Bank Guarantee.

With this order, there was a ray of hope that the airline was on a path to revival. But now, this Supreme Court hearing and any negative order will only add complications to the revival process. Once upon a time, Jet Airways was one of the most loved airlines in India. If it comes back, it would be historical. It will become India’s first airline to restart operations after being dragged into insolvency proceedings.

Do you think Jet Airways will come back? Discuss in the comment section.

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