The National Company Law Tribunal (NCLT) has issued a notice to SpiceJet over an insolvency plea filed by Engine Lease Finance BV, an aircraft engine lessor of the debt-ridden air carrier. The single-member NCLT bench has asked SpiceJet to file a response over the Engine Lease Finance (ELF) plea and directed listing the matter for hearing on August 2, 2024.
During the proceedings, SpiceJet raised objections over the maintainability of the plea, in which ELF has claimed a payment default of over USD 12 million (around Rs 100 crore).
ELF has leased eight engines to SpiceJet. Along with interest and rental, ELF has claimed around USD 16 million dues.
Earlier, the matter was listed before a Delhi-based bench of the NCLT on May 29.
SpiceJet had then raised objections against ELF’s plea citing technical defects and the tribunal gave the engine lessor an opportunity to rectify the errors.
On Wednesday, when the defects were rectified, the insolvency tribunal issued a notice to the airline.
Headquartered in Shannon, Ireland, ELF is the world’s leading independent engine financing and leasing company.
It entered into an agreement with SpiceJet in 2017 to lease engines. According to the petitioner, the low-budget carrier has defaulted on payments since April 2021.
SpiceJet has contended that there is a pre-existing dispute between them.
In 2023, ELF had approached the Delhi High Court against SpiceJet after terminating the lease for two engines and sought possession.
Later, both the parties arrived at a settlement and ELF decided not to pursue the matter.
However, it again approached the high court alleging that SpiceJet had failed to pay in accordance with the settlement terms. The matter is still pending before the Delhi High Court.
SpiceJet has faced insolvency petitions from several of its creditors, including Willis Lease, Aircastle Ireland Ltd, Wilmington and Celestial Aviation.
The NCLT rejected the pleas of Willis Lease Finance and Wilmington Trust. Spicejet settled the case with Celestial Aviation.
The petitions filed by Aircastle and Alterna Aircraft are pending before the insolvency tribunal.
Both Wilmington Trust and Willis Lease Finance have moved the National Company Law Appellate Tribunal (NCLAT) challenging the dismissal of their insolvency plea by NCLT.
Source: Economic Times