SpiceJet tells Delhi High Court it cannot deposit ₹144.51 crore.
Airline cites liquidity crunch and flight cancellations affecting Gulf operations.
Supreme Court earlier refused stay, imposed costs in ongoing dispute.
SpiceJet Seeks Relief From ₹144.51 Cr Payment Direction, Flags Financial Strain
SpiceJet Seeks Relief In ₹144.51 Crore Arbitration Dispute Amid Liquidity Concerns
SpiceJet faces court proceedings over ₹144.51 crore arbitration payment dispute
Summary
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SpiceJet told the Delhi high court on March 17 that it is undergoing a severe liquidity crunch and is unable to deposit ₹144.51 crore as directed in its ongoing arbitration dispute with Kalanithi Maran and KAL Airways Pvt Ltd, reported Mint.
Due to the ongoing conflict, nearly 40% of SpiceJet’s flights to Gulf destinations have been cancelled, further straining its financial position, the airline said in a submission made before a bench of Justice Subramonium Prasad.
SpiceJet moved a fresh plea seeking relief from the direction to deposit ₹144.51 crore within six weeks to meet its payment obligations to Maran and KAL Airways.
Senior counsel Amit Sibal submitted that even before the conflict in Iran, SpiceJet was facing a liquidity crunch due to sustained losses.
“We are not in financial distress—I’m not saying that. But we do have a liquidity issue,” Sibal said.
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SpiceJet and its chairman Ajay Singh also sought modification of the court’s order, offering to provide immovable property valued at about ₹148 crore as security in place of an upfront cash deposit.
“We have unencumbered security and we have based the valuation on that of a registered valuer. I have the original title deeds with me. This was originally encumbered, but it was released to me and therefore I have the original title deeds and can deposit them with the registry,” Sibal told the court.
According to reports, the court is expected to continue hearing SpiceJet’s plea on March 18.
Why SC Pulled Up SpiceJet
The Supreme Court of India on February 27 refused to stay the Delhi high court’s order directing the airline and its promoter Ajay Singh to pay ₹144.51 crore to Maran and KAL Airways. It also imposed a ₹1 lakh litigation cost on Singh.
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A bench of Justices PS Narsimha and Alok Aradhe rebuked the airline over the “tons and tons of litigation” in the matter and observed that the dispute, which began in arbitration, was “never seeing the end of litigation”. According to a Mint report, the court also indicated that the cost could be increased to ₹2 lakh if such pleas continue.