Tribunal issues notice against Jet resolution

Public sector lender Punjab National Bank (PNB) has moved the Insolvency appellate tribunal NCLAT against the approval of bids for defunct airline Jet Airways.

The National Company Law Appellate Tribunal (NCLAT) bench has issued a notice over the PNB's petition along with its interim plea seeking a stay over the execution of the resolution plan.

A three-member bench has directed the Resolution Professional of Jet Airways along with other parties including the Committee of Creditors to file a reply within two weeks and rejoinder, if by PNB, within one week.

"Let the matter be fixed 'for admission (after notice)' on September 21, 2021,” said the NCLAT.

PNB has challenged the approval of the Resolution Plan by Kalrock-Jalan Consortium on June 22, 2021, by the Mumbai bench of the National Company Law Tribunal (NCLT).

The bank is aggrieved by the reduction in its claim amount by around Rs 202 crore by the Resolution Professional, which according to it is in complete violation of the processes as enumerated under the Insolvency & Bankruptcy Code (IBC).

Earlier, Jet Airways Cabin Crew Association along with trade union Bhartiya Kamgar Sena had moved the NCLAT against the approval of bids for the defunct airline.

In their petition, the association and the trade union had submitted that dues of all workmen of Jet Airways were not included as CIRP cost and pending dues were rejected.

Financial distress forced Jet Airways, which flew for more than two decades, to suspend operations on April 17, 2019 and a consortium of lenders, led by the State Bank of India (SBI), filed an insolvency petition in June 2019, to recover outstanding dues worth over Rs 8,000 crore.

In October 2020, the airline's Committee of Creditors (CoC) approved the resolution plan submitted by the consortium of the UK's Kalrock Capital and the UAE-based entrepreneur Murari Lal Jalan.

Jet Airways has been undergoing a resolution process under the Insolvency and Bankruptcy Code (IBC) for two years, and its affairs are being managed by a resolution professional.

Shares of the airline have lost more than half of their value since it suspended operations in April 2019.

The carrier started off as an air taxi operator on May 5, 1993, with a fleet of four leased Boeing 737-300 aircraft. It became a scheduled carrier in 1995, and operated its first international flight from Chennai to Colombo in March 2004.

Photograph: Francis Mascarenhas/Reuters