NCLT lists SpiceJet insolvency plea by aircraft lessor for hearing on May 25

SpiceJet

The National Company Law Tribunal (NCLT) on May 17 said it will hear an insolvency plea by aircraft lessor Aircastle against SpiceJet on May 25.

The tribunal asked the airline to file a response to the lessor’s insolvency plea and explore options for settlement if possible.

Aircastle confirmed that earlier settlement talks with SpiceJet have not been fruitful and the airline's offer was not good enough.

The creditor moved NCLT claiming that SpiceJet has unpaid dues and has sought initiation of insolvency proceedings under Section 9 of the Insolvency and Bankruptcy Code (IBC).

On May 8, a two-member Principal bench of the NCLT headed by President Ramalingam Sudhakar issued the notice to SpiceJet and directed it to list the matter on May 17 for the next hearing.

The development comes close on the heels of beleaguered budget carrier Go First filed for voluntary insolvency resolution proceedings.

SpiceJet, however, said this development will not affect its operations and is confident of resolving the matter without court proceedings. "The comments provided here are without prejudice to our rights and in no way should be deemed as an admission of any liabilities,” a spokesperson for the low-cost airline said.

On May 11, SpiceJet said it is taking steps to revive its grounded fleet using the $50 million it received from the government's Emergency Credit Line Guarantee Scheme (ECLGS) and internal cash accruals, as it sought to quash rumours of insolvency.

Despite the recent turbulence in the Indian aviation space, SpiceJet has said it had no intention of filing for insolvency and was focused on its business.

However, on May 12, aircraft lessor GY Aviation Lease approached aviation regulator DGCA seeing deregistration of two more Boeing 737-8 aircraft of the airline.

Many aircraft of SpiceJet are grounded due to various reasons. Recently, the airline's three lessors - Wilmington Trust SP Services, Sabarmati Aviation Leasing, and Falgu Aviation Leasing - had sought the deregistration of one aircraft each, according to an update on the regulator's website.