The Delhi bench of the National Company Law Tribunal (NCLT) has adjourned to July 21, a lessor's bid to have SpiceJet (SG, Delhi International) declared insolvent. United States-based Willis Lease Finance Corporation is one of three lessors running cases against the Indian low-cost carrier in the NCLT.
In a July 4 hearing, Justice Mahendra Khandelwal queried the Willis petition, given they had previously filed a separate petition, with Krishnendu Dutta, appearing for SpiceJet, arguing that the second petition was for the same course of action as the first.
However, Virender Ganda, appearing for Willis Lease Finance, said the original petition had included some outstanding debts from between March 25, 2020, and March 25, 2021, the so-called "Covid-period." Section 10A of the Indian Bankruptcy Code (IBC) bars debts incurred during this period from being used in insolvency petitions. Counsel for Willis said the second petition correctly excluded those debts. Willis is pursuing SpiceJet for USD6.87 million.
Willis is one of the larger jet engine lessors in the commercial finance space and directly or indirectly owns lease assets valued at USD2.53 billion as of March 31, 2023. In addition, the entity manages 327 engines, aircraft, and related equipment on behalf of other parties.
Under the terms of the IBC, if a lessor wishes to file a second petition involving the same matters, it must first send a notice to the respondent, which Willis appears to have failed to do in this case. Khandelwal acknowledged that the NCLT had previously permitted Willis to withdraw the first insolvency petition but said there was no explicit permission to proceed with a second one. He said the tribunal would consider the validity of the second petition at the next hearing.
The engine lessor declined to disclose to ch-aviation how many engines they placed at SpiceJet. However, CEO Austin Willis said they did business with the airline for some time and that SpiceJet "routinely failed to live up to their promises in the leases and beyond."
Separately, lessors Aircastle and Wilmington Trust have lodged insolvency petitions against SpiceJet in the NCLT, with those matters next scheduled for mention on July 17.
