SpiceJet Faces Fresh Insolvency Pleas from Sabarmati Aviation, JetAir 17

SpiceJet, one of the country’s low-cost airlines is under fresh legal scrutiny as two new insolvency petitions have been filed against it by Sabarmati Aviation and JetAir 17. The petitions were submitted to the National Company Law Tribunal (NCLT) on Monday, adding to the carrier’s mounting legal troubles with creditors.

Sabarmati Aviation’s Plea

The NCLT has issued a notice to SpiceJet over a plea from Sabarmati Aviation, an operational creditor. Senior advocate Krishnendu Datta, representing SpiceJet, stated during the proceedings that a formal response to Sabarmati Aviation’s plea would be filed soon.

Disputed Claims by JetAir 17

JetAir 17, an Irish company specializing in leasing air passenger transport equipment, has claimed $27 million in dues from SpiceJet. However, the airline has contested the claim, arguing that it never entered into a lease agreement with JetAir 17.

JetAir 17 alleges that it inherited lease rights from Wilmington Trust, which had previously leased planes to SpiceJet. Advocate Kunal Tandon, representing JetAir 17, informed the tribunal that Wilmington transferred its interest in the lease to his client. However, SpiceJet’s legal team countered, stating there is no documentation to substantiate this claim. The NCLT has directed JetAir 17 to submit additional documents to support its plea.

Other Legal Challenges

SpiceJet’s financial woes have led to multiple insolvency petitions from creditors, including Willis Lease, Aircastle Ireland Ltd, Wilmington Trust, and Celestial Aviation. Many of these cases are still pending at the NCLT or its appellate body, NCLAT.

In addition to aviation-related claims, SpiceJet has faced demands from operational creditors like Techjockey Infotech, which claimed a default of Rs.1.2 crore for software services. Recently, petitions were also filed by lessors Falgu Aviation Leasing and Aviator ML 29641.

Shares of SpiceJet Ltd. are currently trading at Rs.57.41, marking a 2.90% gain today, a 5.44% decline year-to-date, but a major 50.58% rise over the past year.

Conclusion: All in all, these insolvency petitions show SpiceJet’s financial situation and strained relationships with creditors. As these cases progress, the outcomes could directly impact their operations and stability. For now, the airline continues to contest claims in an attempt to manage its mounting liabilities.

Disclaimer: This blog has been written exclusively for educational purposes. The securities mentioned are only examples and not recommendations. It is based on several secondary sources on the internet and is subject to changes. Please consult an expert before making related decisions.