Supreme Court Rejects SpiceJet's Time Extension Plea In Kalanithi Maran Dispute
In 2018, an arbitral tribunal had awarded a refund of Rs 579 crore plus interest in favour of Kalanithi Maran.
The Supreme Court on Friday refused to grant an extension of time to SpiceJet to make its payments to Sun Group Founder Kalanithi Maran, as per its February order.
The court pointed out that SpiceJet Ltd. is pursuing luxury litigation and obviating the orders of the court.
The Chief Justice of India, DY Chandrachud, while noting that no extra time will be given to the airline, said that this is the only way to instill some sense of commercial ethics in the business community.
The dispute stems from the 2015 agreement between Maran and SpiceJet's promoter, Ajay Singh. Maran and Kal Airways Pvt., his investment vehicle, had transferred their 58.46% stake in SpiceJet to Singh. As part of the agreement, Maran and Kal Airways were to be issued warrants and preference shares. However, these were never issued.
In 2018, an arbitral tribunal awarded Maran a refund of Rs 579 crore plus interest.
In February 2023, the apex court said that bank guarantees to the tune of Rs 270 crore shall be encashed immediately and be paid to Maran within two weeks of the court’s order.
The top court had also directed SpiceJet to pay an amount of Rs 75 crore to satisfy the interest component of the arbitral award within three months.
The top court had made it clear in its order that if SpiceJet failed to pay, the entire award would become executable in its entirety.
In May, the Delhi High Court directed the airline to pay Rs 380 crore because it had failed to comply with the Supreme Court's directions to pay Rs 75 crore.
The high court had noted that there was no alternative except to call upon the airline to deposit the entire outstanding amount along with interest.
A SpiceJet spokesperson has issued a statement saying that the present order of Supreme Court is the reiteration of its earlier order passed in February 2023 and that the main petition challenging the award by both the parties is pending disposal by the Delhi High Court.
The statement said that the matter in the high court relates to payment of interest on a principal amount of Rs 579 crore that has already been paid.
"SpiceJet is engaged in talks with Mr. Kalanithi Maran and his firm KAL Airways and remains committed to finding an amicable settlement. We remain confident of resolving this to the satisfaction of both sides through discussions," it said.
