Jet Airways (JAI, Mumbai International) appears no closer to resolving its long-running stoush with creditors, with legal counsel representing a group of lenders telling a National Company Law Tribunal (NCLT) hearing on December 19 that the previously approved resolution plan was now in doubt because the new owners of Jet Airways have allegedly failed to meet payment obligations.

The Kalrock Capital-Murari Lal Jalan consortium went back to the NCLT this week seeking orders to let it proceed with its takeover and implementation plans but experienced considerable pushback from creditors. India's Mint news portal is reporting that the creditors' committee argued that the consortium has failed to pay or undertake to pay lenders and employees per the conditions set out in the June 2021 resolution plan and later NCLT orders.

Rohan Rajadhyaksha, representing the creditor committee, told the NCLT that India's solicitor general had provided advice suggesting conditions precedent in the resolution plan had not been met. A group of lenders led by the State Bank of India, who all incurred substantial losses when Jet Airways collapsed in 2019, are preventing the consortium from proceeding with the airline's relaunch and reportedly want a renegotiation of the resolution plan. The Kalrock Jalan consortium won the bid to revive Jet Airways in 2020 but has faced an uphill battle to get back into the air ever since.

The lenders, who agreed via the NCLT supervised restructuring process to accept payment of just 5% of their claims, have the right of veto on the takeover process finalising and there have been ongoing disputes over payment timelines and who is responsible for what. The consortium argues all is in order and wants the NCLT orders to let them proceed with the takeover. However, the creditors' committee say the consortium was meant to pay INR1.85 billion rupees (USD22.3 million) in an upfront payment and a further INR1.95 billion rupees (USD23.6 million) six months after commencing operations.

There is also an argument over who is entitled to the INR60 million (USD724,627) in monthly lease income derived from an A330 leased to Air Serbia (JU, Belgrade) through Etihad Airways (EY, Abu Dhabi International) between January 2021 and August 2022 and who is responsible for paying approximately INR200 million (USD2.4 million) worth of provident fund and gratuity dues owed to Jet employees. This payment was ordered in October by an NCLT appeals bench but the Kalrock Jalan consortium has argued it is only obliged to carry out the orders of the June 2021 court-approved plan and has indicated that it will appeal the October ruling.

"As per the resolution plan approved by the committee of creditors and subsequently by the NCLT, our liabilities are capped at INR4.75 billion (USD57.4 million). We are exploring our options at the moment," a Jet Airways official told Mint. The NCLT issued no orders on December 19, with the hearing set to continue over the following days.