Day after lenders move NCLT, tribunal to hear Jet Airways case today

The National Company Law Tribunal (NCLT) will hear Jet Airways' insolvency case today after the SBI-led consortium of 26 banks took the beleaguered airline to the tribunal to recover their dues of over Rs 8,500 crore. The lenders have been trying to sell the airline for the past five months but have failed to find a buyer. In a statement on Tuesday, Jet Airways founder Naresh Goyal expressed his distress over the mounting troubles at the company and hoped for the revival of the airline for the sake of its employees and travellers. "I feel sad and deeply distressed mainly for our loyal employees who have waited months and were anxiously and hopefully awaiting a positive outcome to the Bank-Led Resolution Plan. I can only hope and pray that even now a solution can emerge and Jet can fly and fulfil the needs not only of employees but of air travellers who feel the absence of the Joy of Flying," Goyal said.

The creditors have been looking for a non-bankruptcy resolution ever since its temporary shutdown in April. They even leased out Jet's grounded aircraft on wet lease to the competition to realise a portion of their debt. They had invited bids for selling stake in the embattled carrier. Etihad Airways, a minority stakeholder in Jet, had evinced interest to help the airline's revival but refused to become a majority stakeholder in the company. The UAE-based airline was also in talks with the Hinduja Group to fund the resuscitation of Jet Airways but things took a turn for the worse as Hinduja Group stepped back on its offer in the face of two operational creditors.

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Jet Airways also owes over Rs 10,000 crore to its vendors as rental for aircraft which it had failed to pay up. At its peak, the airline was flying as many as 120 planes, most of which were on the lease. Jet Airways also owes around Rs 3,000 crore to around 23,000 employees who have not been paid since March. Apart from issues with the beleaguered airline, Naresh Goyal has been summoned for questioning in an alleged tax invasion fraud.

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This is the first time when an enforcement agency has summoned Goyal on charges of any financial irregularities in Jet Airways. Now reports suggest the Enforcement Directorate (ED) may also summon Goyal in a separate case of alleged wrongdoing in a stake sale in Jet Privilege, a unit that ran the airline's loyalty programme, reported the Economic Times. Earlier, the investigation wing of the I-T Department had found alleged irregularities in transactions between Jet Airways and its Dubai-based group firms to evade taxes worth Rs 650 crore. Such payments were allegedly in excess of permissible business transactions under the Income Tax Act and would not be considered as allowable expenses.

Edited by Manoj Sharma

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