NCLT admits insolvency plea by SBI against Jet Airways

The local bench of National Company Law Tribunal (NCLT) on Thursday admitted the insolvency application filed by the State Bank of India (SBI) against grounded Jet Airways.

A Bench of judges V P Singh and Ravi Kumar Duraisamy admitted the petition under Section 7 of the Insolvency and Bankruptcy Code (IBC).

The Bench said that the matter is of national importance and directed resolution professional, Ashish Chhawchharia of Grant Thornton, to complete the process within three months as against 180 days (six months) prescribed in the IBC.

The tribunal also rejected an intervention application moved by Netherlands-based operational creditors, citing lack of cross-border jurisdiction.

The matter will be further taken up on July 5 for the filing of a progress report by the resolution professional.

Two separate bankruptcy petitions filed by operational creditors -- Shaman Wheels and Gaggar Enterprises -- who claimed Rs 8.74 crore and Rs 53 lakh respectively from the cash-strapped airline has also been rejected.

On Monday, the SBI-led consortium of lenders decided to take the grounded airline to bankruptcy courts after failing to cobble together a revival plan despite working on it for over five months.

The airline owes over Rs 8,500 crore to the SBI and 25 other financial creditors and over Rs 13,000 crore to hundreds of vendors and the 23,000-odd employees.

The airline, which was started by entrepreneur Naresh Goyal around 25 years ago, was grounded on April 17 after it ran out of cash.

Last week, the National Stock Exchange said that it would remove Jet Airline from daily trading, which will take effect on June 28.