As per latest reports, India's largest private airlines company which is currently facing money troubles may bid goodbye to the skies of the future.
What is happening: Jet’s new promoter doesn’t actually own the airline yet.
Jet, which was scheduled to begin domestic operations in 2022, is still grounded and is still owned by the banks.
Why it matters: Unverified reports are even claiming that owners were considering selling 11 of Jet’s planes because of JKC’s delay in clearing payments.
since its declaration of bankruptcy, the largest private owned airlines of India has faced multiple setbacks, so much so that 3 years post its acquisition it is still not in flight which in turn affects the aviation industry as well as national image.
The big picture: The National Company Law Tribunal is seeing the conflict between JKC and Jet's creditor-owners (NCLT)
Due to JKC's failure to comply with the terms of its reorganisation plan, the creditors are refusing to give over Jet to JKC.
Obtaining clearances for foreign traffic and approvals for landing slots at important Indian airports are two examples of these needs which JKC claims that it has complied with.
Backdrop: A group of banks led by the State Bank of India have acquired Jet since its bankruptcy in 2019 on behalf of its creditors (SBI).
A reorganisation plan was offered by the Jalan-Kalrock Consortium (JKC), which eventually took over as Jet's promoter, in 2020 and was accepted by the creditors.
Numbers: In October of last year, the NCLT ordered JKC to pay the former workers 275 crore rupees (about $33 million) but according to JKC's authorised reorganisation plan, just Rs 52 crore was allocated for employee payouts.
What is being said: JKC’s spokesperson said that
“We reaffirm that there has been no delay from the JKC to implement the resolution plan, and we are in full compliance with the approved plan.”
After the transfer of full ownership, JKC’s spokesperson said, Jet would be ready to take to the skies “within 60-90 days.”
Catch up quick: India's largest private airlines is currently facing money troubles once again putting a question on its continued existence in the backdrop of even its new owners post bankruptcy in 2019, JKC is currently facing losses.
