Bombay HC to hear Jet-Sahara cases

Jet Airways on Monday won the first round of litigation arising out of its failed Rs 2,300 crore deal for acquisition of Sahara Airlines with the Supreme Court allowing its plea for transfer of cases initiated by Sahara in a Lucknow court to the Bombay High Court.

Jet Airways on Monday won the first round of litigation arising out of its failed Rs 2,300 crore deal for acquisition of Sahara Airlines with the Supreme Court allowing its plea for transfer of cases initiated by Sahara in a Lucknow court to the Bombay High Court.

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A Bench of Chief Justice Y K Sabharwal and Justice C K Thakker directed that all the disputes arising out of the collapsed deal be heard by the Bombay High Court, which will first decide the issue of jurisdiction expeditiously. The Bench, however, refused to vacate the stay on the escrow account and advance paid by Jet to Sahara for the deal. It means that the injunction granted by the Lucknow Court will continue till further orders.

Apart from two cases filed by Sahara — a main suit and an application seeking to restrain Jet from with withdrawing the escrow account money, there are two other cases instituted by Sahara shareholders in Lucknow with similar prayers. In fact on the collapse of the deal, Jet and Sahara approached the Bombay High Court and the Lucknow Court, respectively, seeking to restrain each other from withdrawing money deposited in the escrow account with ICICI Bank.

After hearing legal heavyweights representing the parties and discussing the various clauses of the escrow, pledge and guarantee agreements, the Bench said it was of the view that the ends of justice would be met at one court, namely the Bombay High Court.

But it made it clear that the High Court would entertain the matter subject to it having inherent jurisdiction to hear the matter and that it would be open to Sahara to argue before the High Court that it lacked inherent jurisdiction.