NCLT allows transfer of Jet Airways’ ownership to Jalan Kalrock consortium
The National Company Law Tribunal (NCLT)’s Mumbai bench has allowed the transfer of Jet Airway’s ownership to the Jalan-Kalrock Consortium, according to CNBC-TV18. The ownership transfer date will be the starting date for the 180-day deadline to settle the lenders’ dues, said the arbitration panel that adjudicates issues between companies.
The consortium has around six months to settle dues and take control of Jet Airways. ”This means equity can finally come in, and launch planning can resume. However much time has been lost, will have to be made up,” one person familiar with the matter said, according to CNBC-TV18.
Also Read: Jet Airways case: NCLAT dismisses Jalan-Kalrock plea on unpaid provident fund, gratuity dues
Earlier, JKC had sought directions from the bench to hand over the company, however, Jet Airways’ lenders stated that the JKC has not fulfilled three of five conditions precedent mentioned in the NCLT-approved resolution plan.
This point of disagreement between the Jet Airways lenders and JKC caused a standoff, as National Company Law Appellate Tribunal (NCLAT) order of October 21 stated that JKC has “completed all necessary conditions precedent to the satisfaction of the monitoring committee.”
Ashish Chhawchharia, a member of Jet Airways’ monitoring committee had on January 2 sent a letter to JKC wherein he objected to Sanjiv Kapoor using designation of Jet Airways CEO as the airline is yet to be handed over to JKC under the resolution plan.
In March last year, aviation veteran Kapoor was appointed as the CEO of grounded Jet Airways by JKC. The monitoring committee consists of seven members: Chhawchharia as a non-voting member, three voting members selected by lenders and three voting members selected by JKC.
CNBC TV-18 reported in December, citing sources, that amid uncertainty prevailing over the relaunch Jet Airways, several of its senior management executives, pilots and cabin crew have departed. Jet Airways’ vice president of in-flight services, Mark Turner, has been sent on leave without pay, the persons who are privy to the development told the news channel.
Also Read: Jet Airways promoter defends Sanjiv Kapoor’s appointment as CEO-designate
Jet Airways was grounded in April 2019 over piling losses and debt of about Rs 8,000 crore. In October 2020, the airline’s Committee of Creditors (CoC) approved the revival plan submitted by a consortium of Dubai-based entrepreneur Murari Lal Jalan and the UK’s Kalrock Capital.
The consortium had emerged as the successful bidder in the airline’s insolvency resolution process. In June 2021, the consortium’s bid was approved under the insolvency resolution process.
However, the airline’s revival hit a hurdle after the NCLAT directed the consortium on October 21 to pay the provident fund and gratuity dues of employees until June 2019, when the insolvency process started.
The consortium told NCLAT that clearing the dues amounting to about Rs 250 crore was not part of its original resolution plan that was approved by the National Company Law Tribunal.
