Jet Airways' lenders led by SBI oppose JK consortium's claims in bankruptcy court

Jet Airways' lenders have filed a response in the National Company Law Tribunal (NCLT) regarding Jalan-Kalrock Consortium's, winning bidder for Jet Airways, claim of having met all conditions for the takeover of the airline.

There is a crucial hearing on November 29 (tomorrow) about the consortium’s plea to get ownership of Jet Airways as the lenders seek the application to be dismissed for being misleading.

The response has been filed by the State Bank of India (SBI) on behalf of the consortium of financial creditors of Jet Airways.

According to the lenders, Jet Airways stakeholders would face “grave harm and prejudice” if the relief sought by JKC is granted. They have also said that JKC’s claim is an “attempt to cover up” its inability to perform certain actions to fulfil conditions precedent (CP).

Jet Airways’ lenders have alleged that JKC has filed an application to mislead the court on fulfilling conditions as well as seek to take control of Jet and “avoid its obligations” under the approved resolution plan.

The effective date of fulfilment of all CPs in accordance with the terms of the Resolution Plan was extended to May 25, 2022, by NCLT.

Lenders say that JKC has “falsely represented” that it had met CPs for the effective date on May 20, 2022, to the Committee of Creditors (CoC) and on May 21, 2022, to the bankruptcy court its status report.

The lenders go on to say that JKC was unable to fulfil all CPs prior to or by the expiry of the stipulated period of 270 days from approval of the plan.

In June 2022 the lenders obtained a legal opinion from SGI Tushar Mehta who observed that compliance of the CPs by JKC was doubtful. They eventually submitted that they repeatedly maintained the position that the CPs have not been fulfilled over several CoC meetings.

Lenders also alleged that JKC has interpreted conditions precedent in the resolution plan in “unnatural ways to gain advantages” not envisaged by the Plan.

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