The National Company Law Tribunal (NCLT) on January 29 dismissed an insolvency plea filed against low cost airline SpiceJet, filed by its lessor called Wilmington Trust SP Services.
"The insolvency plea stands dismissed," a bench of NCLT comprising members Mahendra Khandelwal and Rahul Prasad Bhatnagar said.
Wilmington had moved an insolvency plea against SpiceJet in June 2023 over unpaid dues. In May 2023, the Directorate General of Civil Aviation (DGCA) deregistered three planes of SpiceJet at the request of lessors, one of the aircrafts belonged to Wilmington.
Lessors Wilmington Trust SP Services, Sabarmati Aviation Leasing and Falgu Aviation Leasing approached the civil aviation regulator, requesting deregisteration of three Boeing 737-800s over non-payment of dues.
The DGCA deregistered the planes with call signs VT-MXJ, MXF and SZJ.
SpiceJet had argued that Wilmington was a part of Aircastle, which had moved two insolvency pleas already.
Wilmington argued that it was a trustee of Aircastle and hence its insolvency plea is maintainable and deserves a hearing by the tribunal. Wilmington's lawyer argued that a trust can classified as operational creditor under the Insolvency and Bankruptcy Code, 2016.
The lessor's lawyer Ajay Kumar took the court through various documents and agreements to establish that Wilmington is a different entity from Aircastle. He urged the court to issue a notice in the plea and ask SpiceJet to file a response.
Senior advocate Krishnendu Dutta, who appeared for SpiceJet, argued that Wilmington and Aircastle were the same entity and this was the organisation's third insolvency plea against SpiceJet. He further argued that an insolvency plea by a trustee of a company was not maintainable.
SpiceJet and lessors
Wilmington's is the second insolvency plea against SpiceJet dismissed by NCLT in the last two months. In December 2023, the NCLT dismissed a plea to initiate insolvency against the airline filed by aircraft lessor Willis Lease Finance over unpaid dues.
SpiceJet had questioned the maintainability of Willis' plea because they had filed a similar plea earlier this year but chose to withdraw it owing to certain technical defects.
In 2023, three lessors moved four insolvency pleas over unpaid dues. NCLT however issued notice only in Aircastle's plea.
Aircraft lessor Aircastle has filed two different insolvency pleas against SpiceJet. In May 2023, NCLT issued a notice in the plea and sought SpiceJet's response. However, in June 2023, SpiceJet challenged the maintainability of Aircastle's first insolvency plea on technical grounds.
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