NCLT questions maintainability of Wills Lease Finance's insolvency plea against SpiceJet

A SpiceJet aircraft.

The National Company Law Tribunal (NCLT) on July 4 questioned the maintainability of the insolvency plea filed by aircraft lessor Will Lease Finance Corporation against low-cost airline SpiceJet, on the ground that Willis had already filed and withdrawn a petition against SpiceJet for the same dispute in March 2023.

Appearing for SpiceJet, senior advocate Krishnendu Dutta argued that Willis had previously initiated an insolvency plea against SpiceJet for the same cause of action. However, it withdrew the plea owing to some technical defects. He questioned as to how Willis could have filed a second plea for the same cause of action in a matter of months.

Senior Counsel Virender Ganda, who appeared for Willis, argued that they had obtained the court's permission to withdraw and refile the insolvency plea and hence it is maintainable. He further argued that SpiceJet owed Wills
$6.87 million and they had to therefore file an insolvency plea.

The tribunal however questioned how a fresh insolvency plea could be filed for the same cause of action, without first sending a notice to SpiceJet under the provisions of Insolvency and Bankruptcy Code, 2016. The tribunal also noted that while NCLT had granted Willis permission to withdraw the previous insolvency plea, they had not explicitly granted permission to refile it. Thus, the tribunal opined that the case would require detailed consideration.

The case is now likely to be heard on July 21, where both the parties may argue on the maintainability of the plea.

Other insolvency pleas against SpiceJet:

There are a total of four insolvency pleas filed by lessors against SpiceJet. Two pleas by aircraft lessor Aircastle and one plea by lessor Wilmington are already pending in the tribunal.

The NCLT on May 8 issued notice in Aircastle's first plea and sought the airline's response. SpiceJet had accordingly filed a response to the plea, and Aircastle sought a short adjournment on May 25 to respond to the airline's reply. Subsequently, SpiceJet had filed an application questioning the maintainability of Aircastle's insolvency plea. SpiceJet has also questioned the maintainability of Aircastle's second insolvency plea and Wilmington's plea. The cases are expected to be heard by the tribunal on July 17.

Real Estate company Acres Buildwell Private Limited, which had initiated insolvency proceedings against SpiceJet, has filed an application in the NCLT to withdraw its plea after the parties resolved the dispute.