In what could be considered a financial relief for Indian budget carrier SpiceJet, the airline has mutually settled the $29.9 million (₹250 crore) dispute with Celestial Aviation. Celestial Aviation which is a subsidiary of AerCap and SpiceJet have settled the dispute through amicable negotiations, avoiding litigation. After this settlement, SpiceJet is expecting to save ₹235 crore.
The representatives of both Parties informed a bench of NCLT last week that settlement terms had been reached and requested an adjournment. The Court further granted the adjournment. The matter is now scheduled to be formally withdrawn on March 1, 2024.
Ajay Singh, CMD, SpiceJet said, "Pleased to announce that SpiceJet and
Celestial Aviation have successfully resolved our $29.9 million dispute through mutual agreement. This settlement marks a significant step forward for both parties and underscores our commitment to finding amicable solutions to complex challenges." Singh further said, "With this resolution, we can now focus on revamping our fleet and driving our business forward."
Celestial Aviation last year had taken SpiceJet to the insolvency court due to non-payment of dues. It claimed a default of $29.9 million for nine aircraft. Celestial Aviation Services had earlier initiated insolvency proceedings against SpiceJet at the National Companies Law Tribunal, making it the fifth lessor to do so against SpiceJet.
The company, in August, filed a plea under Section 9 of the Insolvency and Bankruptcy Code (IBC), 2016, to initiate the Corporate Insolvency Resolution Process (CIRP) against SpiceJet.
Shares of the company were at ₹64.65 apiece when the market closed at 3.30 pm with a 1.61% decline in the BSE Sensex. The stock had fallen as much as 4.73% during morning trade to ₹63.10 apiece, the lowest level since February 15.
It has risen 78.12% in the past 12 months. The relative strength index was at 48.36.
