The Delhi High Court on November 20 summoned low-cost airline SpiceJet's Chairman and Managing Director of Ajay Singh to be present in the court for the second time in three months.
Singh, who was earlier summoned to court in August 2023, will have to be present in the court on January 10, which is the next date of hearing.
The court's direction came after Kalanithi Maran's lawyer Maninder Singh told the court that SpiceJet had to pay Rs 440 crore to them towards interest arising out of dues from an arbitral award. Singh told the court that SpiceJet last made a payment of Rs 100 crore in September and has not made any further payments.
Senior advocate Amit Sibal, who appeared for SpiceJet and its CMD Ajay Singh, argued that the amount due according to them is only Rs 194 crore. Sibal further told the court that SpiceJet was ready to offer them equity shares in lieu of the amount due. According to Sibal, SpiceJet has been struggling to keep itself afloat owing black swan events such as grounding of Boeing 737 Max aircrafts, the pandemic and the rise in fuel prices owing to Ukriane war. Sibal further argued that pushing the company to pay in cash would be detrimental to all the parties involved. He noted that none of the stakeholders would benefit if SpiceJet goes into insolvency. Maran, however, rejected this offer.
The court thus summoned Singh to be personally present in order to ascertain how payments would be made to Maran.
It maybe noted that the Supreme Court in August 2023 ordered Singh's personal presence in a contempt case initiated by Credit Suisse.
Maninder Singh was briefed by law firm Karanjawala and co represented by its senior partner Nandini Gore.
Case file:
In September 2023, SpiceJet and Singh complied with the court's direction to pay Kalanithi Maran Rs 100 crore towards the dues they owed the Sun Group chairperson. The court had warned that a failure to pay could lead to the court attaching SpiceJet's profits for 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 claimed that SpiceJet owed him Rs 393 crore as of August 3 and sought an attachment of 50 percent of SpiceJet's daily revenues towards paying the dues. Maran filed the petition for executing an arbitral award against SpiceJet
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.
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