SBI-led lenders challenge Jet Airways resolution plan in apex court

The 1st trenche of payment of ₹350 crore shall be utilised to pay to workmen, employees and the creditors as per the resolution plan within 60 days from the date of this judgment

Jet Airways resolution plan

New Delhi: The State Bank of India (SBI) and other lending institutions have approached the Supreme Court against the National Company Law Appellate Tribunal’s (NCLAT) nod to the transfer of ownership of the bankrupt airline, Jet Airways, to Jalan Kalrock Consortium (JKC) and its resolution plan.

Lawyers of the lenders said that the bench headed by the Chief Justice of India DY Chandrachud is likely to hear their pleas on Monday. The NCLAT had also upheld the Jalan Kalrock Consortium’s plan for revival of the airline. It had in March this year directed the lenders to transfer the rights to the JCK.

The SBI and other lenders have alleged non-complies of the resolution plan settled by the NCLAT and claimed the plan had failed as successful resolution applicant (SRA), JKC in this case, did not clear payment of ₹7,800 crore. The lenders claimed that the JKC had offered a financial package of ₹4,783 crore, which was to be paid in trenches in the next five year.

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“As per the conditions, the first trenche of ₹350 crore was to be paid by March 21, 2022. However the amount was not paid to the lenders despite several extensions and exclusions granted to the JCK by the National Company Law Tribunal (NCLT),” claimed the lenders.

The NCLAT had in March ruled that the performance bank guarantee (PBG) of ₹150 crore, which is lying with the monitoring committee/MC lenders, shall be adjusted towards the first tranche payment of ₹350 crore as ₹200 crore have already been paid by the SRA (JKC). By adjustment of PBG as per the resolution plan, the first tranche of payment of ₹350 crore shall be completed. “The first trenche of payment shall be utilised to pay to the workmen and employees and the creditors as per the resolution plan within 60 days from the date of this judgment,” the order had said.

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The SBI contended that the NCLT’s approved resolution plan had failed, as the SRA did not clear even the first trenche of payment of ₹350 crore. “The NCLAT’s direction to the SRA to create security by mortgaging Dubai property in 30 days could not complied with,” it added.

The appellate tribunal had in March directed the lenders to facilitate transfer process within 90 days and asked the JKC to obtain the air operator’s certificates by the end of this window. The SBI lawyers contended that the JKC so far refrained from paying ₹175 crore to the SBI, even though 107 days have passed since the NCLAT issued the order for transfer of ownership.

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