The Delhi High Court rejected the review plea filed by SpiceJet and its managing director Ajay Singh over the order to deposit Rs.144 crores in the arbitration dispute with Kalanithi Maran, also imposing Rs.50,000 costs on the airline.
The Delhi High Court dismissed its review plea and ordered the airline to pay Rs.50,000 as costs for filing the petition.
SpiceJet had approached the court seeking relief from an earlier order that directed it to deposit Rs.144.5 crore in its long-running arbitration dispute involving Kalanithi Maran and KAL Airways Pvt. Ltd.
The review petition was filed by SpiceJet and its promoter Ajay Singh. It questioned the high court’s January direction requiring the airline to deposit the amount within a specified timeframe.
The development comes after the court’s March 18 order, which refused to accept SpiceJet’s attempt to alter the earlier direction. Instead, the airline was asked to provide an unencumbered immovable property valued at roughly Rs.148 crore as security in place of a cash deposit.
The ruling is viewed as critical for SpiceJet’s financial stability. The airline argued that it is under severe liquidity pressure and urged the court to allow it to provide a one-acre commercial property in Gurugram as security rather than making an immediate cash payment.
SpiceJet submitted that disruptions tied to the ongoing West Asia conflict, along with a steep rise in aviation turbine fuel (ATF) prices, have worsened its financial stress.
The airline warned that complying with the cash deposit requirement could push it toward collapse, stating that an immediate outflow of Rs.144.5 crore would seriously threaten its ability to continue operations.
The airline also told the court that flight disruptions have affected around 22,000 passengers and 7,000 employees.
SpiceJet had proposed offering an unencumbered immovable property in Gurugram worth approximately Rs.148 crore as security instead of paying in cash.
However, the court did not accept this alternative and insisted on a cash deposit.
SpiceJet maintained that the Gurugram property is unencumbered and that it is ready to submit the title deeds to the court as security.
Opposing the plea, KAL Airways, owned by Sun Group chairman Kalanithi Maran, argued that SpiceJet’s liabilities are far higher than what the airline claimed.
KAL Airways informed the court that SpiceJet owes more than Rs.400 crore, including interest, in the arbitration matter,
“Interest is not being calculated properly in their books.”
It also opposed replacing a cash deposit with property, arguing that the arbitral award must be satisfied through monetary payment. According to Maran’s side, the review petition was aimed at delaying compliance with the court’s directives.
The dispute traces back to January 2015, when Maran and KAL Airways transferred their 58.46% stake in SpiceJet to Ajay Singh amid a period of acute financial distress. As part of the transaction, Maran infused about Rs.679 crore into the airline through convertible warrants and preference shares.
Later, Maran alleged that these instruments were not issued by the new management and sought a refund, leading to arbitration proceedings. In July 2018, the arbitral tribunal dismissed Maran’s claim for more than Rs.1,300 crore in damages, but directed SpiceJet to refund Rs.579 crore along with interest.
The case has since involved multiple rounds of litigation. In February 2023, the Supreme Court ordered the encashment of a Rs.270 crore bank guarantee and directed SpiceJet to pay Rs.75 crore toward interest, warning that failure to comply would make the award fully executable.
SpiceJet has stated that it has already paid around Rs.730 crore to Maran and KAL Airways, covering principal amounts and interest. Still, disagreements over the calculation of the outstanding dues have continued.
In January this year, the Delhi High Court recorded that Rs.194.51 crore remained due under earlier directions. After accounting for Rs.50 crore already deposited, the court ordered SpiceJet and Ajay Singh to deposit the remaining Rs.144.5 crore.
Case Title: SpiceJet Vs Kal Airways
Click Here to Read Previous Reports on SpiceJet