Lenders of grounded Jet Airways are growing frustrated with the holdup in implementing the resolution plan. They are reportedly considering selling 11 of the defunct airline's planes, thus forcing the airline into liquidation.
As per reports, the Insolvency Resolution Plan was approved by banks in October 2020 and the National Company Law Tribunal (NCLT) approved the plan on June 22, 2021. The NCLT has reportedly ordered the Jalan-Kalrock consortium to get the necessary licenses and permissions to operate the airline within 90 days of the approval.
Bankers claim that even one and a half years after the NCLT approved the resolution plan, the Jalan-Kalrock consortium has failed to make the required payment, which has compelled them to rethink their decision, The Economic Times reported.
"Nobody thought this would take so long to execute," The Economic Times quoted a person aware of the deal. He further added, "But the fact is banks cannot transfer the company till we receive the money, and the way things are, it seems that the execution of the deal will not happen soon. Meanwhile, the 11 planes we have in our possession are also losing value. Maybe the time has come to relook at selling those."
Six expressions of interest (EoIs) to purchase these aircraft were reportedly submitted to banks in August. However, the procedure has been delayed by the decision of the Jet Airways monitoring committee, which is made up of banks and Jalan-Kalrock officials. Some bankers believe that since the planes have drawn some attention, banks have another opportunity to recover.
"The Jalan-Kalrock consortium has filed an intervention application in the NCLT, which will come up for hearing on November 29. Banks will watch what they say to the court and act accordingly," The Economic Times quoted another person aware of the case.
The report added that the consortium had blamed the banks for the delay in their submission to the court. However, bankers are reportedly formulating a plan B to end the dispute, even if it entails liquidation. Despite their agreement to waive two preconditions to permit the airline takeover, bankers said that the lack of payments has deepened the trust deficit.
Moreover, there’s an ongoing dispute over unpaid dues between the consortium and the airline's owners. As per reports, Jalan Kalrock Consortium (JKC) has temporarily lowered some employees' salaries by up to 50 per cent and put other workers on unpaid leave beginning on December 1.
