The Delhi High Court has given low-cost airline SpiceJet and its chairman and managing Director (CMD), Ajay Singh, time till September 12 to pay the remaining money toward a Rs 100 crore arbitral award to media baron Kalanithi Maran.
The directions came on September 11 after Singh’s lawyer told the court they had paid Maran Rs 62.5 crore and were carrying a cheque for Rs 37.5 crore in Maran’s name.
Maran’s lawyer Maninder Singh argued that they had time from August 24 to September 11 to make the payment but they had delayed it. He submitted that the opposing parties were habitual offenders as they had earlier not complied with the orders of the Supreme Court and High Court. He further submitted that due to non-compliance by SpiceJet and Ajay Singh, they do not deserve a right to be heard.
Singh's lawyer Amit Sibal argued that the remaining money could not be deposited owing to the bank holiday and considering that September 10 was a Sunday, they are entitled to an additional day to make the payment.
The court asked Singh and SpiceJet to pay the remaining money by September 12
The case will now be heard on October 3.
The court on August 24 directed Singh, who was present in person, and the company to pay Rs 100 crore to Maran by September 10 as bona fide and warned that a failure could lead to the court attaching Spicejet's profits of the previous quarter
Singh was asked to be present in person after Maran filed an application, saying SpiceJet had not filed an affidavit detailing assets and liabilities despite being asked to do so in 2020.
Maran said SpiceJet owed him Rs 393 crore as of August 3 and sought attachment of 50 percent of SpiceJet's daily revenues towards paying the dues.
Validity of the arbitral award
The validity of the arbitral award, which was being contested, was upheld by a single judge of the high court on July 31. SpiceJet and Singh challenged the order before a division bench of the court.
The Supreme Court on July 7 held the award as executable, saying SpiceJet did not adhere to the timeline it had laid down in February to make certain payments to Maran.
Disposing of the case, the top court directed that SpiceJet’s Rs 270-crore bank guarantee be encashed and asked the airline to pay Rs 75 crore towards interest within three months.
Arbitral award
In February 2015, Maran and KAL Airways, his investment vehicle, transferred their 58.46 percent in SpiceJet to Singh, who took on the airline’s liabilities of around Rs 1,500 crore.
As part of the agreement, Maran and Kal Airways said they paid SpiceJet Rs 679 crore for issuing warrants and preference shares. Maran alleged that the warrants and preference shares were not allotted and initiated arbitration proceedings against SpiceJet and Singh.
In July 2018, an arbitration panel rejected Maran’s claim of damages of Rs 1,323 crore for not issuing warrants to him and Kal Airways but awarded him a refund of Rs 579 crore plus interest. SpiceJet was permitted to furnish a bank guarantee for Rs 329 crore and make a cash deposit of the remaining sum of Rs 250 crore.
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