You've money to buy Go First but not to pay Credit Suisse: SC to SpiceJet's Ajay Singh

SpiceJet CMD censured by SC

The Supreme Court on February 19 censured SpiceJet chairman and managing director (CMD) Ajay Singh for not clearing the dues of Credit Suisse, asking him to pay up by March 15 as it took note of him bidding for Go First.

“Why don’t we take judicial notice of the news paper reports that you’re planning to take GoAir? You have that much of cushion and you won’t repay?” the court said, referring to the airline with its earlier name.

"Don't take any risk in this matter," the top court told Singh, adding there was no room for delay and ordered SpiceJet to pay $1.25 million to the Swiss bank by March 15 in addition to the monthly instalments.

Singh has been asked to be present in the court on the next date of hearing.

His move to bid for the grounded Go Air, in personal capacity, along with Busy Bee Airways, has raised eyebrows as SpiceJet battles multiple legal claims over non-payment of dues, including petitions to start insolvency proceedings.

The airline is the middle of a revival plan, having completed the first tranche of capital infusion of Rs 744 crore, with additional subscriptions pending regulatory approval. SpiceJet has also initiated the process to raise an additional Rs 1,000 crore and also has the shareholder's nod to raise up to Rs 2,500 crore through a QIP offer.

The court was hearing a contempt petition filed by Credit Suisse against Singh over the non-payment of due despite a court-approved settlement.

Appearing for Credit Suisse, senior advocate Siddharth Dave told the court that they were to receive $15 million by February 15, however, only $ 13.75 million was paid.

SpiceJet told the court it had made the payment but with a delay.

"This is a positive outcome for the company and our stakeholders, and we are grateful to the court for its understanding. We are committed to paying our dues in full and on time. We remain fully committed to upholding the highest standards of compliance and look forward to continuing our positive engagement with all stakeholders,” the airline said in response to the court's order.

On September 22 , the court ordered Singh and SpiceJet to pay $1 million a month for the next six months to Credit Suisse towards clearing its dues. The low-cost airline was paying $ 500,000 a month but Credit Suisse wanted the payment to be raised to $1.5 million.

On August 14, court issued a contempt notice to Singh on a plea filed by Credit Suisse.

SpiceJet and Credit Suisse entered into an agreement in May 2022 to resolve a payment dispute that arose from the airline’s non-payment of dues to SR Technics, a Switzerland-based company that provides aircraft maintenance services. SpiceJet defaulted on dues amounting to $20 million.