In a reprieve for SpiceJet, the National Company Law Tribunal (NCLT) has dismissed a plea by aircraft lessor Willis Lease Finance Corp. to initiate insolvency proceedings against the airline, currently grappling with financial challenges.
Despite this relief, three other lessors—Celestial Aviation, Wilmington Trust, and Aircastle Ltd—have parallel pleas awaiting resolution at the NCLT, seeking SpiceJet’s admission into insolvency due to unpaid dues. Additionally, business consultancy Raymach Technologies Pvt Ltd has filed a similar plea, prompting the NCLT to issue a notice to SpiceJet.
To address outstanding dues amounting to Rs 2.31 billion (approximately $28 million), SpiceJet had allocated over 48 million shares to nine aircraft lessors. The airline is actively seeking to raise around $100 million, and discussions with global credit funds, led by promoter Ajay Singh, are reportedly underway. The funds raised could potentially be utilized to settle the airline’s pending dues.
In the case of Willis Lease Finance, both parties engaged in a six-month argument. SpiceJet contended that Willis was not among its four operational creditors, challenging the admissibility of the insolvency petition. The airline highlighted Willis’s withdrawal of a previous, similar petition.
The NCLT questioned Willis Lease Finance for filing a new plea for the same cause of action without court permission. The tribunal noted Willis’s status as not being a lessor of SpiceJet in a prima facie assessment.
Willis Lease Finance clarified its role to the NCLT, stating that it was not a lessor but acted as the sole servicer and administrative agent on behalf of actual lessors. As a servicer, it asserted the right to initiate a corporate insolvency resolution process (CIRP) against SpiceJet, presenting relevant documents such as lease, service, and assignment agreements.
While SpiceJet secures a reprieve with the dismissal of Willis Lease Finance’s plea, the airline continues to face legal challenges from other lessors and entities like Raymach Technologies. The NCLT’s decision sets the stage for further developments in SpiceJet’s efforts to address its financial woes and stabilize its operations.