Insolvency appellate tribunal NCLAT has dismissed the plea of Jalan Kalrock Consortium, the successful bidder of Jet Airways, challenging an NCLT order directing the sale of three aircraft of the grounded air carrier.
A three-member NCLAT bench upheld the order of the Mumbai bench of the National Company Law Tribunal (NCLT), which on October 17, 2023, directed to go ahead with the sale of three aircraft to Malta-based firm Ace Aviation.
The National Company Law Appellate Tribunal (NCLAT) also dismissed the petition of All India Jet Airways Officers and Staff Association, challenging the NCLT order.
The NCLAT agreed with the submission that "delaying sale of aircraft shall further diminish the value of aircraft which shall not be in the interests" of Jet Airways.
"We, thus, do not find any good ground to interfere with the order passed by the Adjudicating Authority (NCLT)," it said.
Moreover, the appellate tribunal also said the interests of Jalan-Kalrock Consortium (JKC), the successful bidder, are also protected since the NCLT had directed that the proceeds of the sale of the aircraft are to be deposited in the escrow account and will be dealt with in accordance with the approved Resolution Plan.
While the association had contended that no assets of Jet Airways can be sold unless it is being effectuated for the purpose of the recovery of the PF and gratuity dues of the workmen and employees.
On this, NCLAT said the Association is fully protected and its entitlement will no manner will be affected.
"In view of the foregoing discussions, we are of the view that there are no grounds to interfere with the orders of the Adjudicating Authority dated October 17, 2023, passed in... In a results, both the Appeals are dismissed," said NCLAT.
JKC, the winning bidder for the airline, which stopped flying in April 2019 and later underwent an insolvency resolution process, was having a dispute with the lender. This had put a deadlock over the proposal to sell the three aircraft.
The monitoring committee of Jet Airways had already issued a letter of intent in favour of Ace Aviation for the sale of three Boeing 777 aircraft after a payment of Rs 50 crore on October 19, 2022.
Ace Aviation had participated in the bid for the aircraft.
However, after getting delayed for almost a year, Ace Aviation approached NCLT, which directed it to proceed with the sale of the aircraft.
The sale is expected to fetch Rs 350 crore.