Supreme Court rejects JKC’s plea challenging sale of Jet Airways aircraft to Ace Aviation

New Delhi: The Jalan Kalrock Consortium (JKC), the successful bidder for Jet Airways, has suffered a setback, with the Supreme Court having rejected its plea against the sale of three of the grounded airline’s aircraft to Malta-based Ace Aviation.

The court upheld the National Company Law Appellate Tribunal’s (NCLAT’s) decision that allowed the sale, saying it found no fault with the order. The court noted that the sale would benefit JKC by providing additional funds to clear lenders' dues and revive the airline.

In its plea, JKC had asked the court to put the case on hold until the NCLAT decided on the ownership of the airline. The tribunal had reserved its order in a case in which lenders were seeking to have JKC's resolution plan set aside because of its alleged non-compliance with the approved plan.

In December 2023 the NCLAT dismissed an appeal by JKC, noting that the sale of the aircraft did not affect the rights of any stakeholder in the airline. It said the proceeds of the sale would be deposited in an escrow account before being distributed in accordance with the resolution plan.

The three aircraft are to be sold to Ace Aviation for ₹400 crore but the sale has faced delays owing to disagreements within the monitoring committee, comprising representatives of financial creditors, JKC, and the resolution professional. While the lenders were in favour of the sale, the consortium and workmen opposed it, citing their lien over the aircraft for unpaid gratuity and provident-fund dues.

Ace Aviation approached the NCLT over this deadlock, and in October 2023 the tribunal instructed the committee to resume the process, considering Ace Aviation as an eligible bidder.

Jet Airways has been grounded since 2019 owing to a dispute between lenders, led by State Bank of India, and JKC.

On 22 June 2021, the NCLT approved JKC’s resolution plan for Jet Airways. The consortium comprises UAE-based non-resident Indian Murari Lal Jalan, who will hold shares in Jet Airways in a personal capacity, and Florian Fritsch, who will hold shares through his investment holding company Kalrock Capital Partners Ltd.