Jet Airways: Jalan Kalrock Consortium Seeks Clarity On Ownership

The Jalan Kalrock Consortium asked the National Company Law Appellate Tribunal on Friday to give some clarity on its NCLT-approved ownership of Jet Airways Ltd. The move came after the committee of creditors, led by State Bank of India, filed an appeal against the National Company Law Tribunal's order. 

The consortium argued that it had an approved revival plan in place, but the creditors were creating hindrance in commencing operations by initiating litigation before different forums. The JKC said that even though it had the licence for over a year before it expired, it could not utilise it because of the Committee of Creditors.

In response, SBI submitted that the consortium had not infused any funds in the debt-ridden airline yet and it did not comply with any of the conditions precedent for the transfer of ownership. The creditor argued that the approved resolution plan was not viable and would not be able to revive the airline. 

Assistant Solicitor General N Venkataraman also said Jet Airways did not have the renewed air operator’s certificate after it expired in May. The AOC is a licence that needs to be approved by the Directorate General of Civil Aviation so that an airline can operate the aircraft.

28/07/2023 Charu Singh/BQ Prime

Read More

169 Jet Airways workmen who worked over 240 days to be reinstated

The Supreme Court has ordered reinstatement of 169 workmen to Jet Airways as they'd worked for over 240 days at the airline. A dispute had arisen over non-renewal of workmen's fixed-term contracts. Workmen who've worked for 240 days "would be entitled to be made permanent and no contract/settlement which abridges such a right can be agreed upon", the SC said.

27/07/2023 Ashley Paul/Inshorts

Read More

Jalan-Kalrock Consortium appoints Jatinderpal Singh Dhillon as accountable manager for Jet Airways

Jalan-Kalrock Consortium, the winning bidder for bankrupt Jet Airways, on Wednesday announced the appointment of Jatinderpal Singh Dhillon as the airline's accountable manager. The appointment of Dhillon, a seasoned pilot who has also served in the Indian Navy, is effective from July, JKC said in a statement.

Jet Airways, which has not flown since April 17, 2019 due to financial crunch, went through lengthy insolvency proceedings and the Jalan-Kalrock Consortium (JKC)emerged as the winning bidder.

However, the transfer of ownership to JKC is yet to happen amid persisting differences with the airline's lenders.

"The Jalan-Kalrock Consortium announces the appointment of Jatinderpal Singh Dhillon as the Accountable Manager for Jet Airways.

"The consortium is confident that Dhillon would play a crucial role in the operational preparedness of Jet Airways along with JKC," it said in a statement.

26/07/2023 PTI/Economic Times

Read More

Owners of India's Jet Airways say they're good for the money

The consortium attempting to buy Jet Airways (JAI, Mumbai International) says it has sufficient funds to relaunch the grounded airline and has moved to fill some board vacancies, although it is still without a CEO.

The Jalan Kalrock Consortium (JKC) also says that it has enough cash at hand to pay all creditors, per the terms of the original resolution plan. That plan, approved by the National Company Law Tribunal in June 2021, involved JKC paying creditors caught up in the 2019 insolvency INR4.35 billion Indian rupees (USD53.1 million), but has since been subjected to numerous legal challenges, holding up the payments process, ownership handover, and any restart.

The Hindu Business Line, reporting on the latest developments, says former employees still waiting to be paid their promised entitlements are skeptical, given the consortium's history of failing to deliver on promised payments.

25/07/2023 ch-aviation

Read More

Jet Airways appoints two directors, CFO

Grounded Jet Airways on Thursday announced the appointment of two whole time directors and a non-executive director. Sundaram Ramesh has been appointed as a Whole Time Director and Chief Financial Officer, Gautam Acharya as a Whole Time Director and Rajesh Prasad as a Non-Executive Director, according to a regulatory filing.

The appointments, with effect from Thursday, have been approved by the airline's monitoring committee.

As per the filing, the appointments have been made "for the purpose of ensuring compliance with applicable laws, to execute and make filings with the Registrar of Companies and assist in implementation of the resolution plan".

Ramesh has more than 40 years experience in finance, accounts and taxation, among other areas. Prasad, who has around 40 years of diversified experience, had joined Jet Airways in July 2018 as its Chief Strategy Officer while Acharya is an aviation professional having specialised in commercial aviation for the last 20 years, the filing said.

20/07/2023 PTI/Economic Times

Read More

Jet Airways Founder Naresh Goyal's Property Searched In Forex Case

The properties of Jet Airways founder Naresh Goyal and his associates' were searched by the Enforcement Directorate (ED) in a case linked to alleged foreign exchange law violation.

A preliminary investigation launched in early 2019 alleged provisions of the Foreign Exchange Management Act (FEMA) were violated after Abu Dhabi's Etihad Airways invested $150 million for a stake in Jet, a loyalty and rewards management company formed in 2012 as a subsidiary.

Mr Goyal's role in the deal is believed to be the main focus of that ED investigation.

FEMA offences, however, are not criminal in nature, unlike those under the Prevention of Money Laundering Act (PMLA).

This is not the first time officials have raided properties belonging to Mr Goyal.

19/07/2023 NDTV

Read More

Police move on old pension fund scam at India's Jet Airways

 India's criminal investigation agency, the Central Bureau of Investigation (CBI), has named 15 people in connection with a historical provident fund fraud that left pilots at the defunct Jet Airways (JAI, Mumbai International) short-changed.

Multiple Indian media outlets report that 13 former Jet Airways employees and a husband and wife team at the Employees Provident Fund Organisation (EPFO) were formally named as breaching s.120-B of India's Penal Code and ss.7 and 12 of the Prevention of Corruption Act. The alleged fraud, which occurred between 2003 and 2006, saw EPFO employees Machindra Bamne and his wife Rupali receive approximately INR177,000 Indian rupees (USD2,154) in exchange for covering up payment shortfalls to the provident fund totalling INR35.5 million (USD432,123). The husband and wife team received the payments into their bank accounts.

Jet Airways, which ceased flying in 2019 and is now under new ownership and attempting to relaunch, was responsible for forwarding provident fund contributions made by its pilots to the EPFO. Another EPFO department detected the payment shortfalls in 2007. They submitted several formal payment requests and later visited Jet Airways' offices for audit and verification purposes, with little success, according to formal statements later made by EPFO compliance officers.

Two decades after the alleged offending began, the CBI released its first information report (FIR) on July 11. The FIR is the first formal step in criminal proceedings. Authorities are seeking to determine who received the missing INR35.5 million, given that it never landed in the provident fund accounts of the pilots.

18/07/2023 ch-aviation

Read More

Mumbai News: Relief To Goyals In Notice From Canara Bank

 Mumbai: In yet another relief to Jet Airways founder Naresh Goyal and his wife Anita Goyal, the Bombay High Court on Monday stayed show cause notice issued to them by Canara Bank under the Reserve Bank of India’s (RBI) Master Circular on Wilful Defaulter. 

A division bench of Justices Gautam Patel and Neela Gokhale was hearing a plea by the couple challenging the show cause notices, declaring them wilful defaulters. Earlier, the HC had stayed similar notices issued to Goyals by the IDBI Bank. 

Goyal contended that on receiving the show cause notice, he asked Canara Bank to show the list of documents relied on while declaring them wilful defaulters. However, they were not given the documents, which Goyals argued as a violation of the principles of natural justice. The plea also added that the order was in derogation of the intent of the RBI Master Circular.

Goyal contended in his plea that he was appointed as a non-executive director and his role was to engage in brand building, hunting for talent and best human resources for the company and increasing the presence of the company in the international market. He further said that he was not involved in the day-to-day affairs or executive decisions of Jet Airways.

He also contended that he had not taken a loan from Canara Bank but that ‘Jet Airways Limited’ had taken a loan and hence the bank could not declare him a wilful defaulter independently without proceedings against the company.

17/07/2023 Urvi Mahajani/Free Press Journal

Read More

CBI books EPFO official, 13 ex-employees of Jet Airways in PF claims fraud case

The CBI bas booked a Mumbai-based officer of EPFO and 13 former employees of grounded airline Jet Airways who had paid bribes to him to settle their provident fund claims, officials said Thursday. The case was handed over to the CBI after a probe by the Employees Provident Fund Organisation (EPFO) vigilance found alleged fraudulent activities of Machindra Jagannath Bamne, senior social security assistant posted at accounts section of its regional office in Kandivali(E).

It emerged that Bamne received illegal gratification in his as well as his wife's bank accounts through multiple mode of online banking from employees of various establishments in lieu of their claim settlement.

It is alleged that Rs 1.77 lakh were credited in his and his wife's accounts by 13 employees of Jet Airways which has stopped operations.

"This aspect has been confirmed in the investigation by cross verifying the online credit entries in the accounts of the official and his wife with the corresponding debit entries in the bank accounts of employees of various establishments, whose PF claims were settled by Bamne," the FIR alleged.

13/07/2023 PTI/Economic Times

Read More

'Airline, agent must inform flyer about cancellation'

Vadodara: If the passenger isn't informed about the flight cancellation, the airline and the agent, who booked the tickets, both are responsible for it. The Vadodara district consumer disputes redressal commission (additional) ordered Jet Airways (India) Ltd and tour agent RSGS Holidays to pay money to the aggrieved passenger.

Shivangi Patel, a resident of Harni Road, had filed a complaint against Jet Airways and RSGS Holidays in October 2019.

Patel had bought a return ticket of Jet Airways for her journey from Vadodara to USA via Mumbai in December 2018. She returned from the US to Mumbai in March 2019 and was to take a connecting flight from Mumbai to Vadodara. But the airline staff informed her in Mumbai that her flight to Vadodara was cancelled.

Patel said in her complaint that she was informed through email that there would be delay in the flight departure but she was never informed about the cancellation. She had to buy a ticket for the Vadodara from another airline that also charged her for baggage and she ended up paying Rs 10,894.

RSGS Holidays argued they had booked Patel's ticket through their tie-up with IATA agent Rani Sati Travel House and hence the responsibility lies with the latter. RSGS also said that it will refund the Mumbai to Vadodara fare once it receives it from Jet Airways or the IATA agent.

Jet Airways claimed that an automated message was sent to the booking agent on March 16, March 19 and March 22, 2019 but RSGS claimed that it didn't receive any message of cancellation of rescheduling of the flight.

The forum observed that Jet Airways has not claimed to have informed the guest (passenger) of the scheduled change though it was required to do so as per the revised DGCA guidelines.

Jet Airways hasn't come forward to justify or support the flight cancellation, therefore deficiency lies in their services, the forum observed. The forum also said that RSGS, despite not being an IATA agent, chose to book tickets in its own name and account.

12/07/2023 Tushar Tere/Times of India

Read More

SpiceJet, Go First, Jet Airways navigate in unclear skies

While Air India & IndiGo are increasing their capacity and expanding their network, other players including Go First and SpiceJet are struggling to stay afloat. Add to that, the revival of Jet Airways looks unlikely.  

SpiceJet has posted losses after losses for the last few years. From Rs 934 crores in FY20, its losses climbed to 1,725 crores. 

And to make matters worse the Supreme Court has ordered the airline to pay Rs 380 crores to Kalanithi Maran as interest on the 2018 arbitral award. 

But that's not the only headache for spicejet. Less liquidity led to delayed payments to vendors and now three lessors have moved the national company law tribunal seeking recovery of dues. 

Important to point out that majority of SpiceJet's fleet is leased so non-payment to lessors may result in lessors taking back their planes. As of now, according to a fleet tracking site, the airline has 30 of the 61 planes on ground. This means half of its fleet is not operational.

When you are not flying enough planes, you are not generating enough money to run operations. The airline's domestic market share is a reflection of its status. The airline fell from 10 percent maret share in May 2022 to 5.4 percent in May this year.

Go First is grounded since early May, Resolution Professional has invited bids from potential buyers and airline is yet to receive DGCA's nod to restart operations. Of the 54 planes only 26 are in a reday-to-fly condition. The process is more complicated than it looks. Lessors say Go First doesn't have valid leases to fly their aircraft so fleet availability is a question. Then engine supplier Pratt & Whitney hasn't shared any specific timeline to deliver engines. 

Lenders for the first time have sought liquidation of Jet Airways expressing frustration at the delays caused by the winning bidder Jalan-Klarock Consortium. JKC hasn't paid any money to creditors or workmen so far.

The consortium in June 2021 had promised to pay Rs 380 crores to lenders and Rs 52 crores to workmen to take ownership of the airline. The airline doesn't have an Air Operator's Certificate anymore, neither does it have the required manpower.  

11/07/2023 Madeeha Mujawar/CNBC TV18

Read More

Wind up Jet Airways, resolution plan not working, creditors tell SC

Jet Airways creditors have called for the grounded airline to be wound up, telling the Supreme Court on July 10 that the resolution plan approved by the National Company Law Tribunal (NCLT) was not workable.

Appearing for the Committee of Creditors (CoC), additional solicitor general N Venkatraman told the apex court that Jalan Kalrock Consortium, which was given the ownership of the airline, had not infused any funds into the company.

The Director General of Civil Aviation was not ready to renew the airline's Air Operator's Certificate, which expired in May, he said.

The consortium had not met its funds infusion target but was getting repeated extensions from tribunals. The company would have to go into liquidation if CoC were to recover any of its dues, Venkatraman said.

The Jalan Kalrock Consortium in a response to questions sent by Moneycontrol said that it’s “resolution plan provides for fund infusion to start only after the Effective Date and due to the challenges made on the effective date there have been delays in implementing the resolution plan.”

“JKC shall not do anything or has done which is contrary to the NCLT approved resolution plan and is fully committed in reviving Jet Airways,” the association said in a statement.

It added that it has “invested approximately Rs 300 crore in the entire process which also includes Rs 20 Crores in Jet Airways directly till date.”

Seeking Jalan Kalrock's response, the court has listed the next hearing in two weeks.

10/07/2023 SN Thyagarajan/Moneycontrol

Read More

Jet Airways 2.0: Jalan-Kalrock resolution plan not working, creditors tell SC

Jet Airways creditors on Monday told the Supreme Court that the Jalan-Kalrock resolution plan approved by the National Company Law Tribunal (NCLT) is not workable. They called for the airline to be wound up.

The insolvency process began in June 2019 and the NCLT approved a resolution plan submitted by the Jalan-Kalrock Consortium on June 22, 2021. The plan would see the consortium of Jalan-Fritsch take over Jet Airways and inject $1.3 billion into the airline.

However, the creditors have challenged the plan in the Supreme Court. They argue that the plan is not fair to all of the creditors, and that it would not be able to revive the airline.

The Additional Solicitor General (ASG) N Venkatraman told the Supreme Court on July 10 that not even a single penny has been paid to lenders or infused in the debt-laden airline. On the contrary, the lenders have infused public money of around Rs 400 crore, including airport dues.

The ASG was arguing on behalf of the resolution professional (RP) of Jet Airways. The RP has challenged the resolution plan of the Jalan-Fritsch consortium in the Supreme Court.

The ASG said that the resolution plan is not feasible and that it would not be able to revive the airline. He said that the plan would not provide enough money to pay off all of the airline's debts, and that it would not be able to attract new investors.

ASG further added that the DGCA was not ready to renew Jet Airways' Air Operator's Certificate (AOC), which expired in May. The AOC is a license issued by the DGCA that allows an airline to operate flights.

The Jalan-Kalrock consortium had not met its funds infusion target, and it was getting repeated extensions from the tribunals. The creditors' committee (CoC) had said that the company would have to go into liquidation if it were to recover any of its dues.

10/07/2023 Business Today

Read More

India's DGCA plays hardball with re-issue of Jet Airways AOC

India's Directorate General of Civil Aviation (DGCA) will only re-issue an air operator's certificate (AOC) to Jet Airways once it resolves disputes with lenders and provides proof of its financial capabilities, according to India's Hindu Business Line.

Jet Airways' AOC lapsed in May. The report says the DCGA will only re-issue one if the airline can lock in senior management and reconstitute its board, resolve legal disputes, including those with lenders, and secure aircraft lease agreements. Since losing its AOC, Jet Airways has reportedly approached the DGCA seeking a new one.

Jet Airways ceased operations in April 2019 owing around INR80 billion rupees (USD975.5 million). In October 2020, a vote by the committee of creditors approved a bid by Murari Jalan and Florian Fritsch to buy the airline. The new owners planned an imminent restart, which was contingent on them paying creditors (including banks) around USD0.10 on every dollar owed and pumping almost INR10 billion (USD122 million) into recapitalising Jet Airways over five years.

However, the agreement has since collapsed into a mire of recriminations and legal disputes, with the airline no closer to restarting. The saga has generated plenty of headlines in India but has recently been overshadowed by the Go First (G8, Mumbai International) insolvency. That airline is also attempting to restart. But, as the DGCA points out, Go First's restart currently has the backing of lenders, while the Jet Airways restart does not.

05/07/2023 ch-aviation

Read More

Spent Rs 470 crore since CIRP without any return; Jet Airways CoC tells SC

The Committee of Creditors (CoC) of grounded airline Jet Airways told the Supreme Court on July 5 that it has spent Rs 470 crores since the implementation of the Corporate Insolvency Resolution Process (CIRP), without getting any return on investment.

Represented by Additional Solicitor General Venkatraman, the CoC further told the court that they are incurring expenses to the tune of Rs 23 crore per month. Jet Airways workmen association agreed with the CoC and informed the court that they have not been paid their dues as well.

The apex court was hearing a case by the Jet aircraft engineers maintenance welfare association against the company seeking recovery of their dues.  The case was adjourned after the bench led by Chief Justice of India DY Chandrachud was informed that other cases pertaining to recovery of dues from Jet Airways are pending before other benches of the apex court.

The CJI directed that all the cases pertaining to Jet Airways be grouped together and listed before his bench for hearing soon.

In May 2023, the National Company Law Appellate Tribunal (NCLAT) granted Jalan Kalrock Consortium, which emerged as a successful bidder to take over Jet Airways, more time to make payments to the State Bank of India (SBI).

The appellate tribunal has noted that despite National Company Law Tribunal (NCLT) having approved the resolution plan in January, the case came to be heard by the NCLAT in March and order of refusal of stay was passed on March 3, hence the tribunal held that Jalan Kalrock is entitled to an exclusion from November 16, 2022, to March 3, 2023, for complying with payment obligation towards SBI.

On January 13, the National Company Law Tribunal (NCLT) allowed the transfer of the beleaguered airline to the consortium led by London-based Kalrock Capital and UAE-based entrepreneur Murari Lal Jalan.

It also asked the consortium to make payments by May 15, 150 days from the initiation of the ownership proceedings, but the NCLAT exemption gives it more time.

05/07/2023 SN Thyagarajan/Moneycontrol

Read More