Delhi High Court tells SpiceJet to pay $2.67 million to lessor in a week

Chairman and Managing Director of SpiceJet Ajay Singh appeared before the Delhi High Court during the hearing

The Delhi High Court on Thursday directed SpiceJet to pay $2.67 million to French engine and aircraft lessor Team France 01 SAS within a week over non-payment of dues for three leased aircraft. 

The total amount payable to Team France stands at $6 million and after the payment of $2.67 million, the remaining amount of $3.33 million is to be submitted in the high court in an interest-bearing fixed deposit within three weeks. The three aircraft have been returned to the lessor.

 

Chairman and Managing Director of SpiceJet Ajay Singh also appeared before the Delhi High Court, which had summoned him during the last hearing.

 

The airline’s counsel had said last year that there is an admitted default to the extent of $2.67 million towards the outstanding amount and sought an extension of time. He had also said that they have plans to raise $357 million.

 

The lessors had filed a case against SpiceJet in December, claiming dues of more than $20 million for the engines.

 

However, the court slammed the airline saying that if they had the financial means to pay, the airline wouldn’t be defending itself in court.

 

“You are using someone else’s property, and you can’t use it without paying the rent. He’s (lessor) in the business of letting out that property, whether it’s an engine today or a house. Which court allows you to use property without paying?” the court asked.

 

The court also highlighted the other mounting troubles for the airline, pointing out its failure to pay salaries to employees.

 

In the previous hearings, the court had told SpiceJet to confirm if their directors will pledge personal guarantee to pay engine lessors for three engines.

 

“If the company alone is liable and it has no money, then perhaps your directors should provide personal guarantees. Otherwise, it seems the directors themselves have no faith in the money coming in,” the court had remarked.

 

“You’ve been repeatedly giving undertakings to the court. If you’re not in a position to pay, then you should ground these engines. Why are you using them if the company is unable to pay?” the court asked.