National Company Law Tribunal Admits Insolvency Petition By Jet Airways’ Top Lender SBI; Appoints Resolution Professional
[ By Bobby Anthony ]The National Company Law Tribunal has admitted an insolvency petition filed by Jet Airways’ top lender State Bank of India (SBI) and approved a resolution professional to oversee the insolvency proceedings.The NCLT took the position that since the Jet case is a matter of national importance, the resolution professional would have to complete the process in three...
The National Company Law Tribunal has admitted an insolvency petition filed by Jet Airways’ top lender State Bank of India (SBI) and approved a resolution professional to oversee the insolvency proceedings.
The NCLT took the position that since the Jet case is a matter of national importance, the resolution professional would have to complete the process in three months instead of the 180 days the process usually takes.
The insolvency resolution professional has been mandated to immediately take control of all Jet Airways assets and submit a progress report every 15 days, the first of which will be submitted before the court on July 5.
In a related development, the NCLT also rejected an intervention application filed by a trustee appointed by a court in the Netherlands, decreeing it had no jurisdiction on a company registered in India, since no cross-border insolvency laws exist.
Earlier, the Netherlands court had declared Jet Airways bankrupt on an application made by two transport services providers and appointed Rocco Mulder as administrator in the bankruptcy proceedings.
As things stand, the insolvency resolution professional will take control of Jet Airways and try to find out a resolution applicant or bidder to revive the company.
According to the Insolvency & Bankruptcy Code (IBC), if the insolvency resolution professional and the committee of creditors (CoC) fail to find a buyer for Jet Airways or put together a revival plan, the company will get liquidated and all its assets will be sold to repay its creditors.
Earlier, SBI’s counsel Cyril Amarchand Mangaldas’ Animesh Bisht had stated that Jet Airways had a total loan default worth Rs 469 crore to SBI. Jet’s total debt to banks is Rs 8,700 crore, while it owes another Rs 10,000 crore to its operational creditors and Rs 4,000 crore in salaries as well as statutory dues.
Incidentally, two operational creditors, Shaman Wheels Pvt Ltd and Gaggar Enterprises Pvt Ltd have already filed two separate insolvency pleas against the airline in the Mumbai NCLT.