NCLAT refuses to stay plea on Jet’s ownership transfer
2 min read . Updated: 02 Mar 2023, 01:29 AM IST
Premium- An NCLAT bench headed by Justice Ashok Bhushan said refused to entertain the lenders plea
The National Company Law Appellate Tribunal (NCLAT) on Wednesday refused to stay a National Company Law Tribunal (NCLT) order of 13 January, which allowed the ownership transfer of Jet Airways Ltd to the Jalana Kalrock consortium, the successful resolution applicant.
An NCLAT bench headed by Justice Ashok Bhushan said refused to entertain the lenders plea. “The Plan needs to be implemented as approved by the NCLT," it said, adding that the lenders must move forward in implementing the resolution plan without further delay. A detailed order in the matter is awaited.
On 8 February, the lenders moved the NCLAT challenging the NCLT order. The consortium and lenders have been at loggerheads over the implementation of the resolution plan that was approved in June 2021.
On 13 January, the NCLT said it goes without saying that the plan approved by the tribunal has to be implemented without any modification. “We are of the view that in the interest of justice and in achieving the primary objective of maximization of assets and resolution of corporate debtor, we grant exclusion of 180-days for taking control of the corporate debtor(Jet)," it added.
The Jalana Kalrock consortium has six months from 16 November, the effective date for taking control of Jet, to pay the dues owed by the beleaguered airlines’ employees.
Lenders, however, argued that the consortium did not adhere to the conditions precedent (CPs) required for the transfer of ownership, but the consortium said it had satisfied all the requisite CPs that were required to take control of Jet.
Moreover, the lenders also said that the viability of the approved plan submitted by the consortium was highly doubtful since it did not offer any comfort to lenders in terms of paying their consideration obligations.
Jet Airways owes its operational and financial creditors more than ₹15,000 crore.
As per the plan, the consortium had to also pay the gratuity and provident fund dues owed to former employees and workmen of the cash-strapped airline. The consortium had also knocked on the doors of NCLAT seeking to cap its payment liabilities at ₹475 crore under the approved resolution plan.