The Supreme Court on Thursday sought a response from Kalanithi Maran-led KAL Airways on an offer from SpiceJet Ltd to consider ending a share transfer dispute with the airline on receiving ₹600-odd crore towards full and final payment.
A bench, led by chief justice of India NV Ramana, gave Maran and Kal Airways time till February 14 to respond to the settlement offer, which entailed encashment of bank guarantee of ₹270 crore, with a top-up amount of ₹30crore.
“Of the principal amount of ₹578 crore awarded in arbitration, SpiceJet has already paid ₹308 crore in cash to them,” senior advocate Mukul Rohatgi, representing SpiceJet, informed the bench, which also included justices AS Bopanna and Hima Kohli.
Senior advocate Maninder Singh and advocate Nandini Gore, who appeared for KAL Airways, submitted that they would come back to the court with instructions from their client on the feasibility of the offer from Spicejet. The lawyers also highlighted that there is a recent Madras high court order on winding up of SpiceJet and that they are apprehensive about their arbitral award becoming redundant if the winding up proceedings begin against the airlines.
At this, the court said that KAL may consider either accepting ₹300 crore in addition to the amount already paid towards full and final settlement of the share transfer dispute, or receiving ₹100 crore at present, awaiting a final decision by the Delhi high court on execution of the arbitral award.
{{/usCountry}}At this, the court said that KAL may consider either accepting ₹300 crore in addition to the amount already paid towards full and final settlement of the share transfer dispute, or receiving ₹100 crore at present, awaiting a final decision by the Delhi high court on execution of the arbitral award.
{{/usCountry}}A share transfer dispute arose between SpiceJet and Maran after co-founder Ajay Singh took over the airline in 2015. In February 2015, Maran transferred his shareholding in SpiceJet to Ajay Singh, who is currently chairman and managing director of the airline. This was after the airline nearly went belly-up during 2014-15 due to a severe cash crunch. Singh, who paid ₹2 to take over the airline, also took over SpiceJet’s liabilities worth ₹1,500 crore.
As part of the agreement, Maran and KAL Airways had paid ₹679 crore to SpiceJet, under Ajay Singh, for issuance of warrants and preference shares.
Maran approached the Delhi high court in 2017, complaining that neither the convertible warrants and preference shares have been issued, nor was the money returned by the airline, and Singh.
Maran and his firm KAL Airways later moved the Supreme Court urging the apex court to lift the stay on a Delhi HC order asking SpiceJet to deposit ₹243 crore as interest on the amount of ₹578 crore to be payable to Maran in the dispute. The Supreme Court stayed the Delhi HC order in November 2020. KAL Airways filed a plea through Karanjawala and Co for vacating the stay on recovery of decreetal amount from SpiceJet.
On January 28, the Supreme Court, in a separate case, stayed the winding up proceedings against SpiceJet and gave it three weeks to resolve its financial dispute with a Swiss financial services company over recovery of dues of ₹180 crore.