SC asks Maran, KAL Airways to mull SpiceJet settlement offer on share spat

SpiceJet offers to pay Rs 600 cr cash in the share transfer case with former promoter Kalanithi Maran and his firm KAL Airways for a full and final settlement of all disputes

In what is likely to lead to a permanent solution to a long-drawn share dispute between SpiceJet's Ajay Singh and the airline's former promoter Kalanithi Maran, the Supreme Court on Thursday asked Maran and his KAL Airways to consider the new settlement offer by SpiceJet.

"SpiceJet has offered to pay Rs 600 crore in cash in the share transfer case with its former promoter Kalanithi Maran and his firm KAL Airways for a full and final settlement of all disputes," the airline said in a statement on Thursday. The offer was made during the hearing in the Supreme Court. The Court has advised the Maran side to consider the proposal of SpiceJet and has listed the matter on February 14.

"Out of the principal amount of Rs 578 crore awarded in arbitration, SpiceJet has already paid Rs 308 crore in cash and deposited a bank guarantee of Rs 270 crore," the company said. Mukul Rohatgi, Senior Counsel appearing for SpiceJet proposed to pay the bank guarantee equivalent amount of Rs 270 crore in cash and top it up with additional Rs 22 crore aggregating the total payout to Rs 600 crore as full and final settlement of all disputes between the Parties. According to the media reports, if the offer is not agreeable for Maran, the counsel proposed the disbursement of a reduced amount secured under a bank guarantee to him.  

The controversy kicked off in 2015 when Maran sold his 58.46 per cent stake or 50.4 million shares in SpiceJet to Singh for a nominal Rs 2 after the airline was hit by financial trouble. In 2016, Maran approached the court citing a breach of the agreement by Singh, not issuing him 189-million share warrants and preference shares, despite his Rs 679-crore infusion. He claimed Rs 1,300 crore from SpiceJet and Singh due to this. In July 2016, the High Court asked Maran and Singh to set up an arbitration tribunal.

The arbitration tribunal consisting of three retired judges from the Supreme Court, Arijit Pasayat, Hemant Laxman Gokhale and KSP Radhakrishnan had rejected the damages claim of Kalanithi Maran and Kal Airways against SpiceJet in 2018. In 2020, the High Court asked the airline to submit Rs 243 crore to Maran on the issue and that got a stay from the Supreme Court in November 2020. Maran was before the Apex Court it to lift the stay on a Delhi High Court order.

In January, the Madras high had dismissed an appeal moved by airline challenging an order directing the winding up of the company and takeover of its assets by the official liquidator. This case is also before the Supreme Court now.