Creditors of Jet Airways (JAI, Mumbai International) continue to hinder the ownership transfer of the airline to the Jalan Kalrock Consortium (JKC) even though that entity has made good on its obligation to pay INR3.5 billion rupees (USD42 million) to take over the airline.
Counsel for the creditors' committee, led by the State Bank of India, told the National Company Law Appellate Tribunal (NCLAT) in Delhi on October 4 that they wanted to know the source of the funds, suggesting that JKC had obtained it from external sources.
After extensive delays, JKC finally recently paid creditors the amount agreed to in an NCLAT-approved resolution plan. It paid two tranches of INR1 billion (USD12 million) and told the creditors' committee to use a previously lodged INR1.5 billion (USD18 million) bank guarantee to access the remainder. However, the creditors now want to know the source of the two INR1 billion payments. They insist that the funds must come from the consortium, not a third party. Counsel for the consortium accused the lenders of deliberately blocking the ownership transfer.
"We highly question the lenders' intent to transfer the ownership of the company in favour of JKC after JKC has executed all its obligations under the court-approved resolution plan by paying the full amount of INR3.5 billion," counsel for the consortium told the tribunal. "This is in light of the latest application filed by the committee of creditors to stay the implementation of the approved resolution plan recently in the NCLT."
The tribunal asked the creditors' counsel to file any objections to the ownership transfer before the next scheduled appearance, set for October 19, while counsel for the consortium will provide details on the source of the funds.
ch-aviation has approached JKC for comment.
