Spicejet on Monday undertook before the Delhi High Court to deposit the outstanding ₹144.5 crore in its long-running arbitration dispute with KAL Airways and its promoter Kalanithi Maran in tranches, after receiving partial financial assistance under the Centre’s emergency credit programme for airlines.
Justice Subramonium Prasad accepted the undertaking by SpiceJet and its Managing Director Ajay Singh to deposit ₹50 crore with the court registry within 45 days and the remaining amount over the following 90 days, giving the airline about 4.5 months to deposit the entire amount.
Senior advocate Mukul Rohatgi, appearing for SpiceJet, informed the court that the airline had received partial financial assistance under the Centre’s emergency credit programme introduced to support airlines affected by operational disruptions arising from the recent West Asia conflict.
He submitted that while part of the assistance had already been received, the remaining support was expected shortly, enabling the airline to complete the balance payment within the timeline proposed before the court.
The High Court also deferred hearing SpiceJet’s petition under Section 34 of the Arbitration and Conciliation Act, 1996, challenging the arbitral award, saying it would take up the matter only after the airline complies with the deposit directions.
The dispute dates back to 2015, when KAL Airways transferred its 58.46% stake in SpiceJet to promoter Ajay Singh during a period of severe financial stress. As part of the transaction, Kalanithi Maran infused around ₹679 crore into the airline through convertible warrants and preference shares. Maran later alleged that the new management failed to issue those securities, triggering arbitration proceedings.
In July 2018, an arbitral tribunal directed SpiceJet to refund ₹579 crore, along with interest. The litigation has since gone through multiple rounds before the Delhi High Court and the Supreme Court.
Earlier this year, the Delhi High Court recorded that ₹194.51 crore remained outstanding under its earlier directions. After adjusting ₹50 crore already deposited, the court directed SpiceJet and Ajay Singh to deposit the remaining ₹144.5 crore with the court registry.
The airline had sought permission to furnish a commercial property in Gurugram as security instead of making an immediate cash deposit, arguing that doing so would worsen its liquidity position, but the plea was rejected.
The latest development follows the Supreme Court’s May 19 order declining to interfere with the Delhi High Court’s deposit direction while allowing SpiceJet to approach the High Court for extension of time in light of the West Asia crisis and the Centre’s emergency credit support programme for airlines.
