The Madras High Court stayed its earlier order of winding up SpiceJet and appointment of official liquidator for a period of three weeks, subject to the condition that the company deposits the amount equivalent to $5 million within a period of two weeks, the company said in a statement
In a filing to BSE, the budget carrier said the Madras High Court had on Monday issued an order of “winding up SpiceJet and appointment of official liquidator” in a case filed by Credit Suisse claiming non-payment of $24.01 million dues to engine maintenance services firm SRT Technics.
“The Madras HC despite holding that SRT did not have a valid authorization from DGCA to carry out engine maintenance during the currency of the agreement rejected the company’s defence and ordered winding up of the company and directed the official liquidator to take over the assets of the company,” SpiceJet noted.
“The Company opposed the petition inter alia on the grounds that there is no legally enforceable debt because SRT, did not possess the relevant DGCA approval for provision of services under the Agreement. SRT made a fraudulent misrepresentation to the Company of having applicable DGCA approval for providing the services,” SpiceJet said in a filing.
“The Company raised a bona fide dispute claiming that the provision of engine maintenance without DGCA approval is contrary to Indian and other applicable laws and voids the entire agreement. Since the agreement falls and is void, Credit Suisse as an assignee does not and cannot have any claim against the Company”
However, on the same day, the Madras High Court issued another order wherein it stayed its previous order and gave SpiceJet “a period of three weeks, subject to the condition that the company deposits the amount equivalent to $5 million within a period of two weeks.”
“The Company is examining the order and shall initiate appropriate remedial steps including preferring an appeal before the appellate jurisdiction within the time frame allowed by the Madras High Court,” SpiceJet noted.
The carrier further said it has a good case on merits and was hopeful of having favourable outcome in the appeal.
SpiceJet reported a net loss of ₹934.8 crore and ₹998.3 crore in 2019-20 and 2020-21, respectively.
It had reported a net loss of ₹729 crore for the quarter ending June 2021 as its flight operations were affected due to the second wave of the Covid-19 pandemic.
Source: Mint