Maran vs SpiceJet: HC asks airline to file affidavit on assets, revenue

NEW DELHI: The Delhi High Court on Wednesday allowed Kal Airway's and its promoter Kalanithi Maran's application seeking 50 per cent of the daily revenue collection of low-cost airline SpiceJet Ltd to be paid to them on a weekly basis.

While Justice Yogesh Khanna issued notice to the airline and its Chairman and Director (CMD) Ajay Singh, he mandated the latter's presence on the next date of hearing, which has now been set to August 24 from September 5.

Considering the willful default and lackadaisical attitude of SpiceJet and Singh, the judge reiterated his July 24 order and advanced the hearing.

The court directed the airline and CMD to file an affidavit disclosing their assets and their revenue collection within one weeks' time.

During the hearing, Senior Advocate Maninder Singh submitted that in view of the willful defaults at every stage and laid back attitude it is just and fair that the Spicejet and Singh should deposit 393 crores Approx. and file their affidavit of assets before the next date of hearing.

The counsel sought directions from the court for his client that the 50 per cent of the daily revenue collected by the judgement debtors be paid to decree holders -- Kal Airways and Kalanithi Msran -- on weekly basis, the affidavit of disclosure of assets be filed at the earliest, the statement of accounts be filed within one day in court and the main prayer i.e. entire arbitral awarded amount be paid to the decree holders.

On the other hand, Senior Advocate Sandeep Sethi admitted that the orders have not been complied with by Spicejet.

However, he said that this is a fresh application listed on Wednesday and submitted that since the matter is already directed to be listed on September 5, the matter may be heard on that date as the judgment debtor -- SpiceJet and CMD -- is bound by court orders.

He also argued that there is no reason for allowing early hearing at this stage.

To which, the judge then observed that the decree holder is not left with any other option but to move an early hearing application as the judgement debtor is not complying with the orders passed by the courts and the judgement debtor should have filed its affidavit of disclosure of assets till date.

On July 24, the high court issued notice to SpiceJet and Singh seeking urgent hearing of its enforcement petition in a case where the former is to pay approximately Rs 390 crore to it towards its interest liability under the arbitral award.

Allowing the application, Justice Khanna had directed SpiceJet and its CMD to file an affidavit disclosing all their assets before the next date of hearing, September 5, and also mandated the physical presence of Singh before it.

The Supreme Court had, on February 13, directed SpiceJet to pay Rs 75 crore to decree holder (Kal Airways and Maran) within a period of three months towards its interest liability under the arbitral award, and had also clarified that in the event of failure to pay, the entire award would become executable in entirety in favour of decree holder.

On the applications seeking further time extension that were moved by SpiceJet for two more months as the three months time period had expired on May 13, and it failed in honouring the top court's order, the counsel for the decree holder had informed the court that the apex court order of February 13 has been now reaffirmed by another order dated July 7, whereby the time applications of SpiceJet are also dismissed.

The apex court, while dismissing the same, observed that SpiceJet’s application is nothing but a delay tactic to not pay money even when there are court orders directing the same.

Singh had told the high court that SpiceJet is not honouring the orders passed by any of the courts, and has earlier too failed to comply with the order passed by this court dated November 4, 2020, directing the airlines to file its affidavit of disclosure of its assets. It was also reaffirmed by order dated May 29 by this court and the same is not filed till date, he apprised the court.

He had submitted before Justice Khanna’s bench that Order XXI Rule 41 (iii) of Code of Civil Procedure clearly provides that the court may, for a period not exceeding three months, pass an order of arrest of the Judgement Debtor for not complying with the order to file affidavit of assets.

Following the top court’s order dated February 13, the high court had on May 29, directed SpiceJet and Ajay Singh to pay the entire executable amount under the award to the decree holder.

On Wednesday, Senior advocate Sandeep Sethi with advocate Atul Sharma appeared on behalf of SpiceJet Ltd and Ajay Singh.

Senior advocate Maninder Singh, instructed by senior partner Nandini Gore, principal associate Sonia Nigam, associate Yash Dubey and associate advocate Akarsh Sharma from Karanjawala & Co. appeared on behalf of the Kal Airways Pvt Ltd and Kalanithi Maran.