Delhi High Court asks SpiceJet to deposit Rs 579 crore

A division bench headed by justice S Ravindra Bhat also directed the carrier to furnish a bank guarantee of Rs 329 crore with the court towards satisfaction of the disputed amount.

By: ENS Economic Bureau | New Delhi | Published:July 4, 2017 4:11 am
spicejet owner case, spicejet, delhi high court spicejet case, spicejet case depost, business news Sources said that SpiceJet will move the Supreme Court against the HC order.

Dismissing SpiceJet and its co-founder Ajay Singh’s petitions, the Delhi High Court on Monday directed the budget airline to pay Rs 250 crore as a cash deposit on or before August 31 in a share transfer dispute with its previous owner Kalanithi Maran. A division bench headed by justice S Ravindra Bhat also directed the carrier to furnish a bank guarantee of Rs 329 crore with the court towards satisfaction of the disputed amount.

“Although we do not find merit in the appeal and have dismissed it, we have passed an order modifying the impugned order,” Bhat said, adding “there is nothing worthwhile” in the airline’s plea to show its finances were precarious or that its cash position was so stretched that it cannot comply with a single-judge order to deposit the amount. “There is neither reference to any figure or amount, nor reliance on any balance sheet, nor even the income and expenditure statement of the company, to say that compliance with the impugned order would irreparably injure it.

“The court notices that the nearly 18 month pendency of this appeal, and the non-compliance with the impugned order (of single judge), has aggrandised the appellant (SpiceJet), which was to have the benefit of the amounts.” “If there were any difficulties, this interregnum period would have helped it considerably tide over its affairs and certainly afforded time to organise it better and in a more orderly fashion to comply with the order,” the bench said while dismissing the appeals of the airline and its co-founder Ajay Singh.

The court, however, said that the modification of the single judge’s order of July 29 last year was essential considering the unpredictable nature of likely injury that may be caused to the commercial operations of the company if entire amount is secured through a deposit. The single judge had asked the airline to deposit Rs 579 crore within five months with the first one in August 2016 before its registry and also asked it to consider arbitration proceedings to resolve the dispute with Sun Group chief Kalanithi Maran and his KAL Airways over share transfer within a year. Sources said that SpiceJet will move the Supreme Court against the HC order.

(With FE inputs)

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