Jet Airways case: Supreme Court directs JKC to deposit Rs 150 crore

The Supreme Court on Thursday ordered Jalan Kalrock Consortium(JKC), the successful bidder for bankrupt Jet Airways, to deposit Rs 150 crore in two weeks in the escrow account of the State Bank of India (SBI) as part of the resolution plan. The apex court, setting aside the order of the National Company Law Appellate Tribunal (NCLAT) of August 2023, said the amount is to be deposited before January 31, failing which, it will be non-compliant with the resolution plan to take over Jet Airways.

"The question of adjustment of Rs 150 crore (through bank guarantee), we will keep it with the NCLAT. You (JKC) have to (pay)," the apex court said.

JKC was supposed to pay Rs 350 crore as part of the first payment. It had deposited Rs 100 crore by August 31, 2023, and another Rs 100 crore by the end of September 2023. The lenders in the NCLAT had questioned the source of the money and said it was non-compliant with the resolution plan.

The Consortium also said since it has already pledged a bank guarantee of Rs 150 crore, this could be invoked by the lenders. However, the lenders had argued that the bank guarantee of Rs 150 crore is a backup and cannot be invoked at this stage. They had objected to encashing the bank guarantee.

Solicitor General Tushar Mehta, appearing for the lenders, told a bench of CJI D Y Chandrachud and Justices J B Pardiwala and Manoj Misra on Wednesday that the total admitted claim of the financial creditors is Rs 7,800 crore but the financial package offered by JKC is Rs 4,783 crore, which is payable in tranches in five years. "The financial creditors (banks/lenders) are struggling to get an amount of Rs 350 crore towards the first tranche payment, even two years after approval of the resolution plan," he told the court.

"At every stage, they(lenders) are objecting. If you don't want the bank guarantee, give it back," Senior Advocate Mukul Rohatgi, appearing for JKC said on Thursday.

“This company (JKC) only engages in litigation. Every day we stand before the court. It is not just a question of Rs 150 crore. There are a host of conditions in the Resolution Plan that they cannot comply with. There are three more conditions they have not complied with,” said Additional Solicitor General (ASG) N Venkataraman, appearing for the lenders.