The National Company Law Tribunal (NCLT) on October 10 told the low-cost airline SpiceJet and its lessors Aircastle and Wilmington to study the impact of the recent notification removing aviation lease agreements from moratorium under the Insolvency and Bankruptcy Code, 2016.
The cases are now likely to come up for hearing on November 7 for further consideration.
Aircraft lessors Aircastle and Wilmington have filed insolvency pleas against SpiceJet over unpaid dues. However, SpiceJet has challenged the maintainability of these petitions on certain technical grounds.
On October 4, the ministry of corporate affairs released a notification exempting relating to aircraft, aircraft engines, airframes and helicopters from moratorium to comply with the Cape Town convention.
Once a moratorium is imposed, activities such as institution of suits, continuation of pending suits, execution of judgments, transferring/disposing off assets and recovery or enforcement of security interest are prohibited.
As a result of this notification, the moratorium will not include agreements relating to aircraft, aircraft engines, airframes and helicopters. This would mean that aircraft, engine and helicopter leased and other agreements will not be bound by a moratorium.
Aircastle's insolvency pleas against SpiceJet:
Aircastle has filed two insolvency pleas against SpiceJet. While NCLT has issued notice in one plea, the tribunal has questioned the maintainability of the second plea.
On May 8, a two-member principal bench of the NCLT headed by Ramalingam Sudhakar issued notice to SpiceJet and listed the matter on May 17.
The tribunal had on May 17 asked the Gurugram-based airline to file a response to the lessor’s insolvency plea and explore options for settlement. 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.
Meanwhile, SpiceJet had filed a plea questioning the maintainability of Aircastle's petition on the ground that Aircastle's power of attorney granting the authority to its representative is defective and also that they had not filed a proper affidavit.
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