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Synopsis

A CJI DY Chandrachud led bench of the Supreme court has today ordered liquidation of Indian airline Jet Airways after noting that 5 years had elapsed since the approval of the resolution plan.

It is to be noted that in April 2019, unable to cope with its financial liabilities, Jet Airways ceased operations. In 2020, its committee of creditors approved a resolution plan submitted by UK’s Kalrock Capital and UAE-based entrepreneur Murari Lal Jalan to revive and operate the airline. However, the consortium had not implemented the plan.

Citing its powers under Article 142 of the Constitution, the Supreme Court has ruled for liquidation, stating that Jalan-Kalrock Consortium's (JKC) failure to fulfil its obligations left no viable path for the airline’s revival.

In January this year, the Supreme Court ordered JKC, the successful resolution professional bidder for the cash-strapped airline, to deposit Rs 150 crore in an escrow account jointly held by the State Bank of India and JKC. It had cautioned that legal consequences would follow if the JKC failed to furnish the bank guarantee.

NCLAT Order which allowed the cash-strapped Jet Airways' ownership transfer to the Successful Resolution Applicant (SRA) without complete payment in accordance with the resolution plan has also been set aside.

NCLT Mumbai Bench has now been asked to appoint a liquidator and the amount of Rs 200 crores paid by the SRA stands forfeited.