India's Supreme Court has denied an appeal by the would-be new owners of Jet Airways (9W, Mumbai International) concerning the payment of INR2.5 billion rupees (USD30.6 million) to former employees, leading to further doubt about the airline's relaunch.

Led by Chief Justice D.Y. Chandrachud, on January 30, 2023, the three-judge bench, that also included Justices P S Narasimha and J B Pardiwala, rejected the appeal brought by the Kalrock Capital-Murari Lal Jalan consortium (JKC) that sought to overturn an October 2022 National Company Law Appellate Tribunal (NCLAT) order that directed it to pay the provident (pension) fund and gratuity dues (an annual bonus based on years of service) owed to former employees.

“Anyone stepping in would know that there are overriding labour dues. Unpaid labour dues always take precedence. Somewhere, there has to be finality. Sorry, we will not interfere,” the Supreme Court ruling read.

Under the terms of the 2021 National Company Law Tribunal (NCLT) approved resolution plan, JKC could take control of the grounded airline in exchange for total capped payments of INR4.75 billion (USD58.2 million), which included INR520 million (USD6.37 million) to cover outstanding amounts owed to former employees. Since that resolution plan was agreed to, lawyers for JKC have argued that additional claims, including this one, were invalid. The lawyers said that once approved, a resolution plan cannot be modified.

Represented by the Association of Aggrieved Workmen of Jet Airways (AAWJA), some 270 former Jet Airways employees have been fighting for payment of provident fund and gratuity monies due to them. In the NCLAT's October 2022, JKC was ordered to pay the monies owed to the employees as of June 2019, when the airline's insolvency proceedings commenced.

After a competitive bidding process, JKC won the right to acquire Jet Airways in mid-2021. In addition to the agreed capped payments, the consortium promised to put an additional INR9 billion (USD110.1 million) into the airline. However, ownership of the airline has remained vested with a monitoring committee made up of creditors, JKC representatives, and Ashish Chhawchharia, head of restructuring services at Grant Thornton. The monitoring committee has proved a constant thorn in JKC's side, refusing to allow the ownership transfer amid a series of disputes over payments and payment timelines. Earlier this month, in separate legal proceedings, the NCLT cleared the way for the consortium to takeover Jet Airways, setting a new effective date of ownership that resets the payment timelines. However, ch-aviation has learned that several lenders, another consortium led by the State Bank of India, filed an appeal against this on January 24, claiming that a condition precedent mentioned in the resolution plan has not been met, rendering the plan invalid

Meanwhile, Saurabh Kripal, appearing for the Jalan-Kalrock Consortium, told the Supreme Court that having to find the additional funds to pay the former employees may make it difficult to relaunch the airline. ch-aviation has approached Jet Airways for comment.