Jet Airways can go ahead with its joint venture with Godrej Properties for developing a 3.5 lakh sq ft plot at Bandra-Kurla Complex, the Bombay high court said on Friday.
The plan had been stuck for the past two years, following a court stay because of the airline’s dispute with Sahara Airlines over its buyout price.
However, the court has restrained Jet from alienating (meaning, selling or creating third party rights) 1.5 lakh sq ft of the built-up area, which is to be the airline’s share after the property is developed.
The division bench of chief justice Mohit Shah and justice Girish Godbole also restrained the airline from mortgaging or creating any encumbrance on half of the developed property (75,000 sq ft).
The court was hearing an appeal filed by Sahara, which challenged the May 4 order - passed by a single judge of the high court — that Jet’s liability is Rs 1,450 crore, as against Sahara’s claim of Rs 2,000 crore.
Pradeep Sancheti, Sahara’s counsel, had sought a stay on the development of the BKC property, saying that it could be disposed of after development.
Janak Dwarkadas, counsel for Jet Airways, had opposed the stay saying that if the development did not get started, the lease agreement with the MMRDA would lapse.
Trying to put Sahara’s apprehension to rest, Dwarkadas assured the court that Jet would not dispose of the 1.5 lakh sq ft or create any encumbrance until the next date of hearing, which is on June 14.
Dwarkadas said Friday’s order would help improve Jet’s balance sheet. Jet will receive Rs135 crore from Godrej in addition to Godrej taking over Jet’s loan of Rs100 crore from the HDFC bank. “This will improve our balance sheet by Rs235 crore in addition to us getting a built-up area of 1.5 lakh sq ft,” he said.