SpiceJet (SG, Delhi International) has enjoyed another legal win against a lessor, with the National Company Law Tribunal (NCLT) dismissing an insolvency petition from Wilmington Trust SP Services (Dublin). The airline confirmed the outcome via a two-line notice filed at the Bombay Stock Exchange (BSE) on January 30.
Justices Mahendra Khandelwal and Rahul Prasad Bhatnagar, sitting on the Delhi Bench of the NCLT, ruled on the matter of Wilmington Trust SP Services (Dublin) Ltd. vs. SpiceJet Limited (case no: IB-349/ND/2023) on January 29. The judges said Wilmington's petition "lacks merit, is not maintainable, and therefore stands dismissed."
Counsel for the budget carrier successfully argued that Wilmington was merely a trustee and not an operational creditor. They argued that a trustee could not be the beneficial owner of an asset. Counsel said SpiceJet owed the debt to Aircastle (Ireland) Ltd, and until the airline defaulted, invoices were issued by that company and monies were paid into an Aircastle account. Aircastle ultimately owns Wilmington Trust.
The LCC scored a similar legal victory recently against another lessor, Willis Lease Finance, also successfully arguing it was not an operational creditor and so was not entitled to pursue an insolvency petition.
SpiceJet continues to defend insolvency petitions in the NCLT, with Aircastle having three listed and active and Alterna Capital Partners also initiating a petition against the airline earlier this year.
However, it had less luck in another court this week, with the Delhi High Court ordering it to pay USD4 million to engine lessors Team France 01 SA and Sunbird France 02 SAS by February 15. Indian outlets reported the LCC owes them USD12.9 million and had requested additional time to pay the debt, suggesting an initial repayment of USD1 million would be appropriate. The lessors wanted USD5 million upfront. On January 29, the court ordered the airline to hand over USD4 million by mid-February ahead of a court hearing later that month.
Long short of cash, shareholders of SpiceJet recently approved raising INR22.5 billion rupees (USD270.6 million) via a share and warrants issue. The proceeds from this are starting to come in. Earlier this week, a leaked internal staff memo revealed SpiceJet had around INR9 billion (USD198.3 million) in the bank.
