Liquidator Appointed for Jet Airways
India’s specialist bankruptcy court, the National Company Law Tribunal (NCLT), has appointed a liquidator for Jet Airways. During a hearing on November 26, the Mumbai bench designated Satish Kumar Gupta, a senior partner at Jaipur-based Gupta Garg & Company, to fulfill this role.
/safari-india/media/media_files/2024/12/02/vJe13eMjnndlIZfbVTsa.jpg)
The NCLT’s order stated that Gupta should “endeavour to sell the company as a going concern during the liquidation process.” This decision came after a Supreme Court ruling on November 7 that ordered Jet Airways’ winding up. The airline halted its operations in 2019, and a subsequent resolution plan to sell it to the Jalan Kalrock Consortium (JKC) failed and became embroiled in litigation. The consortium was chaired by Florian Fritsch from the UK’s Kalrock Capital and included UAE-based entrepreneur Murari Lal Jalan.
The Supreme Court was hearing a crucial appeal from the primary creditor, the State Bank of India, which aimed to overturn a recent decision made by the National Company Law Appellate Tribunal (NCLAT). This decision altered the terms of the original resolution plan. However, the Supreme Court stated that the NCLAT’s decision was “perverse and unsustainable in law” and had resulted in further complications.
“Almost five years have elapsed since the NCLAT duly approved the resolution plan, and there being no progress worth the name, we are left with no other option but to invoke our jurisdiction under Article 142 of the Constitution and direct that the corporate debtor be taken in liquidation,” the Supreme Court ruling read before referring the matter back to the NCLT with the order that it appoints a liquidator.
At its peak, Jet Airways was one of the largest airlines in India, holding a 21.2% share of the passenger market by early 2016. At that time, it operated over 300 flights daily to 74 destinations. However, the rise of low-cost carriers like SpiceJet and IndiGo began to erode its market share and negatively impact its financial performance. By 2019, Jet Airways had accumulated significant debts, and by April of that year, it had run out of cash. As a result, the airline could not pay for fuel and other immediate expenses, leading to the suspension of flights. At that point, Jet Airways was reduced to just five ATR 72-500 aircraft operating regional routes from Delhi.
