SpiceJet, Engine Lease Finance Reach Agreement Outside Court

SpiceJet Ltd. and Engine Lease Finance Corporation Aviation Services Ltd. have agreed to resolve their disagreement without continuing proceedings before the Delhi High Court. The lessor has said it would not continue its action to get its one remaining aircraft engine back from the airline. 

In the hearing on Monday, both sides' lawyers told the Delhi High Court that they had agreed on the terms of the settlement. After they asked for more time, the court agreed, setting the next meeting for Feb. 8, 2024.

In the previous hearing, the court granted the budget airline time until Oct. 16 to engage in discussions for a resolution with the engine lessor, Engine Lease Finance BV. The court cautioned that if the negotiations fail, it would have to issue an order to prohibit the use of the leased engines.

In the matter at hand, Engine Lease Finance BV went to the Delhi High Court in late September to ask SpiceJet Ltd. to stop using one of its leased engines and give it back. They had leased nine engines to the airline and want the last one back. Justice Sachin Dutta heard the case and seemed likely to agree with the lessor but let SpiceJet present its side.

Previously, even the National Company Law Tribunal disclosed that SpiceJet faced five insolvency petitions, all filed by lessors instead of financial institutions. Consequently, the court recommended that the airline explore the option of settling with the lessors, a move deemed beneficial for SpiceJet.