SC allows SpiceJet to pay Credit Suisse in monthly installments
The Supreme Court has allowed Indian airline SpiceJet to pay its outstanding dues to Credit Suisse in monthly installments for six months. The airline was behind on payments by $3 million and had recently paid $1.5 million following a court order. Credit Suisse had filed a plea in March to initiate contempt proceedings against SpiceJet and its chairman and managing director Ajay Singh.
Origins of SpiceJet's debt to Credit Suisse
SpiceJet's debt to Credit Suisse originated from a 10-year aircraft servicing and maintenance agreement signed with Swiss MRO service provider SR Technics in November 2011. After failing to make payments of over $24 million, SR Technics transferred the rights to receive payments to Credit Suisse, which filed a winding-up petition against SpiceJet in the Madras High Court in 2021. The airline is also involved in legal disputes regarding payment of dues with the lessor community and former promoter Kalanithi Maran.
SpiceJet's commitment to clearing dues
SpiceJet has expressed its commitment to paying its dues in full and on time. The airline recently completed a payment of $13.5 million to Sun Group chairman Kalanithi Maran, as per the Delhi High Court's order regarding the execution of an arbitral award. The court is scheduled to hear the rest of the case on October 3, with SpiceJet owing a total of $53.7 million to Maran.
Court previously warned chairman of imprisonment
The Supreme Court has cautioned Ajay Singh to fulfill the payment obligations or face imprisonment in Tihar Jail. The airline had challenged the high court order before a division bench, which upheld the single judge's order. SpiceJet then challenged the ruling in the Supreme Court, which stayed the high court order and gave the company three weeks to settle the matter. The recent permission to pay in installments is a crucial development in resolving the ongoing legal disputes.
