The Delhi High Court has directed budget carrier SpiceJet to pay ₹380 crore to the airline's former promoter, Sun Group chairman and founder Kalanithi Maran.
Justice Yogesh Khanna passed the order after Maran's counsel argued that the airline was violating a previous decision of the court on a share transfer dispute. Maran's counsel argued that the ₹75 crore had not yet been deposited and that the interest liability had gone from ₹362 crore to ₹380 crore.
The Delhi High Court directed SpiceJet to deposit the entire outstanding amount and file an affidavit of assets within four weeks.
Meanwhile, SpiceJet says it is already in discussions with Maran and his firm KAL Airways for a comprehensive settlement of the matter. "We are confident of resolving the same mutually as we have already paid the entire principal amount of ₹578 crore earlier awarded by the Arbitral Tribunal," the airline's spokesperson says.
The dispute between the two parties dates back to 2015, when Kalanithi Maran first approached Ajay Singh, SpiceJet’s current chairman and managing director, who had been associated with the airline previously. The ownership of the airline was transferred to Singh for ₹2.
At the time of transfer, the company had debt and liabilities outstanding of over ₹3,500 crore with immediate payables of around ₹2,200 crore and its Boeing fleet was reduced from 41 to 17 aircraft.
To keep the debt-laden carrier afloat, Singh asked the Marans to put in a substantial amount of money to clear up dues including tax liabilities and also provided some liquidity to keep the company running. It is this ₹578 crore — invested by the Sun Group at the time — which is now the main bone of contention. At the time of handing control to Singh, the Marans felt that the business had potential, so an agreement was reached whereby SpiceJet would issue cumulative redeemable preference shares (CRPS) that would help them keep one foot in the door but did not offer them any voting rights.
The no-frills airline has witnessed a consistent drop in its market share over the past few months. The Gurugram-based carrier's market share dropped to 5.8% in April from 6.4% in March, according to data released by aviation regulator DGCA (Directorate General of Civil Aviation).
In a stock exchange filing last month, SpiceJet said it plans to bring 25 of its grounded planes back into service. "The airline is targeting the return of four of its grounded aircraft, two Boeing 737s and two Q400s, by June 15. More planes will be back in operations in the following weeks," the filing said.
SpiceJet has initiated the process of reviving its grounded fleet with the $50 million funds received from the government’s Emergency Credit Line Guarantee Scheme (ECLGS) and internal cash accruals.
The low-cost airline recently restructured over $100 million in outstanding dues to Carlyle Aviation Partner into equity shares and compulsorily convertible debentures (CCDs).
SpiceJet had hived off its cargo and logistics division SpiceXpress into a separate entity, SpiceXpress and Logistics Pvt Ltd, in April, paving the way for SpiceXpress to raise funds independently.
