New Delhi: Setting aside an order National Company Law Appellate Tribunal (NCLAT) the Supreme Court has ordered the liquidation of Jet Airways’ assets. The three-member bench rapped the NCLAT for its order and observed the appellate body acted against settled legal principles.
Pronouncing the verdict, a three-member bench comprising Chief Justice D.Y. Chandrachud and Justices J.B. Pardiwala and Manoj Misra set aside NCLAT’s verdict approving the resolution plan of the grounded airline and transfer of ownership to Jalan Kalrock Consortium (JKC).
Pronouncing the judgement, Justice Pardiwala allowed the plea of SBI and other creditors against the NCLAT decision that upheld the resolution plan of Jet Airways in favour of JKC, PTI reported. The bench observed it is ordering the liquidation of the airline in the interest of creditors, workers and other stakeholders.
Ordering the liquidation of Jet Airways as per the Insolvency and Bankruptcy Code, the bench directed the National Company Law Tribunal in Mumbai (NCLT) to appoint a liquidator immediately to carry out the liquidation, Bar and Bench reported.
Notably, Jet Airways was grounded in 2019 owing to financial issues. The airline’s creditors led by the State Bank of India moved the National Company Law Tribunal and initiated insolvency proceedings. In 2021, Jalan Kalrock Consortium–a consortium led by UAE-based entrepreneur Murari Lal Jalan and UK-based Kalrock Capital–emerged as the successful bidder for the airline’s revival.
However, following disputes over the fulfilment of the conditions precedent, the creditors refused to transfer ownership to JKC. In January 2023, NCLT dismissed creditors’ objections and ordered a transfer of ownership. Though the lenders approached the appellate tribunal against NCLT’s order, the NCLAT upheld the tribunal’s order and directed the transfer of ownership within 90 days.