The Supreme Court on Wednesday reserved verdict on the plea of SBI-led lenders’ consortium seeking scraping of the three-year-old Rs 4,783 crore resolution plan of Murari Jalan-Florian Fristch for revival of bankrupt Jet Airways under IBC on the ground that the successful resolution applicant has failed to deposit even the first tranche of Rs 350 crore.
Additional solicitor general N Venkataraman with SBI counsel Sanjay Kapur told a bench of Chief Justice D Y Chandrachud and Justices J B Pardiwala and Manoj Misra that the SRA has floundered at the inception stage every step of the resolution plan, which warranted upfront deposit of Rs 350 crore, which was part of the Rs 4,783 crore payment the SRA was to pay over five years.
The Jalan-Fristch consortium, the successful resolution applicant (SRA), has so far deposited only Rs 200 crore with an additional bank guarantee of Rs 150 crore and failed to comply with the SC order that extended time for payment of balance Rs 150 crore by Jan 31 this year, the ASG said.
SBI-led consortium said the RP was approved by the Committee of Creditors (CoC) in June 2019 when the airport dues payable by Jet Airways were Rs 240 crore, which after five years have spiraled to Rs 11,00 crore. The SRA cannot escape this liability nor the mandate to pay the statutory dues of Jet Airways employees amounting to Rs 226 crore, it said.
Jalan-Fristch was to deposit Rs 475 crore towards airport dues within 180 days of the effective date of the RP. Moreover, the SRA till date does not have a Air Operation Certificate, which was valid till September 3 last year and was extended till June this year on NCLAT orders.
Seeking setting aside of NCLAT’s March 12 order and rescinding of the RP for Jet Airways, the SBI-led consortium said, “The SC should direct liquidation of Jet Airways invoking its omnibus powers under Article 142 to prevent further litigation.”
It sought appropriation of Rs 200 crore and invocation of bank guarantee for Rs 150 crore deposited by Jalan and Fristch and requested the SC to direct the latter “to pay airport dues which stood at Rs 1,100 crore.”
“There has been inordinate delay and utter non-cooperation at every stage and right from the beginning, Jalan-Fristch had no inclination to execute the plan and valuable time of more than 2.5 years had been lost since the NCLT passed on June 22, 2021, approving the resolution plan. The SC should therefore impose huge damages for the loss of valuable and irretrievable time,” it said.
For the SRA, senior advocates Mukul Rohatgi and Gopal Sankaranarayanan told the court that the SRA has done its best and met the condition precedents, but the SBI-led consortium has adopted a non-cooperation approach right from the beginning. They said the SRA is still willing to work out modalities to revive Jet Airways.
