SC gives SpiceJet 3 weeks to resolve payment claim

Airline owes $24 million to Swiss vendor

Updated - January 28, 2022 11:17 pm IST

Published - January 28, 2022 10:46 pm IST - NEW DELHI

Photo used for representational purpose only.

Photo used for representational purpose only.

The Supreme Court on Friday gave air carrier SpiceJet three weeks to resolve its dispute over the non-payment of more than $24 million to a Swiss company towards maintenance, repairs and overhaul of aircraft engines and components.

“What is this? Why are you not paying up? Are you taking advantage because you are a busy airline? Do you want to run or close the show,” Chief Justice N.V. Ramana asked SpiceJet, represented by senior advocate Harish Salve. The Bench, also comprising Justices A.S. Bopanna and Hima Kohli, proceeded to give a short reprieve to the airline by staying the publication of a Madras High Court (HC) order to wind up the company.

The court stayed the HC order for three weeks so that the airline could work out a “serious offer” to the satisfaction of Credit Suisse AG, which was assigned the right to receive the payments due to SR Technics.

“This is a serious matter, if you don’t want to run the airline, we will declare it insolvent and go for liquidation,” the CJI addressed Mr. Salve.

The senior lawyer, as soon as the hearing started, sought a three-week adjournment of the case.

“We are working something out. Gives us three weeks. We will have a serious offer,” Mr. Salve submitted to the Bench.

Senior advocate K.V. Vishwanathan, for the Zurich corporation, countered that the offer made now by the airline was “not even worth mentioning”.

“What is offered now is not even worth mentioning,” he submitted.

However, Mr. Vishwanathan agreed on behalf of the corporation to wait for three more weeks.

The court, in its order, noted that the airline was trying to resolve the dispute and granted three weeks’ time while ordering the stay of the HC order. It adjourned the case.

Earlier, a Division Bench of the Madras High Court had dismissed the appeal by SpiceJet against a Single Judge Bench order of December 6 to wind up the company.

The Division Bench had concluded in favour of the arguments made by Credit Suisse AG that the air carrier had not made out any grounds to entertain the appeal.

However, the Division Bench had acquiesced to SpiceJet’s request to continue to stay the Single Judge order. It had extended the interim stay till January 28 as the air carrier had already deposited $5 million in court.

The airline had then approached the top court for relief.

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