The National Company Law Tribunal (NCLT) on Wednesday directed the financial creditors of Jet Airways to disburse Rs 63 crore worth of interim funds in 15 days.
The interim funding was approved by the members of the committee of creditors (CoC) of Jet Airways on July 19 to safeguard the airline’s assets and run the insolvency process.
Passing an oral order, a two-member Mumbai bench of the tribunal noted that the resolution professional (RP) is facing “tremendous hardship” due to unavailability of funds.
Judge VP Singh said, “It is pertinent to mention that the RP is duty bound to maintain the corporate debtor (Jet Airways) as a going concern.”
CoC had on July 19 approved providing Rs 63 crore as interim funding towards preserving Jet’s aircraft and other assets, and to cover the day-to-day expenses of the insolvency proceedings.
State Bank of India (SBI) is the only lender which has disbursed Rs 10 crore for the same so far. The RP’s counsel informed the bench that, of the approved amount, only around Rs 26 crore has been sanctioned so far by lenders, including HDFC and ICICI Bank.
Earlier this month, the RP’s counsel told the bench that the corporate insolvency proceedings of the airline could come to a “grinding halt” due to dearth of funds. The bench directed financial creditors, including Indian Overseas Bank and Axis Bank, that are yet to sanction any disbursal to “do so immediately”.
Jet Airways, which has been grounded for over five months now, was admitted for insolvency on June 20. While passing the insolvency order, the Mumbai bench of the NCLT observed that Jet Airways was a matter of “national importance” and directed the RP to “make every possible effort to complete the corporate insolvency process at the earliest possible time”.
The Synergy Group, a significant stakeholder in the Columbian Avianca Airlines, is currently the only party participating in the resolution of Jet Airways. The RP aims to present a final resolution plan for the airline for NCLT’s approval by October 28. According to the latest update, creditors have filed claims worth Rs 30,907 crore with the grounded airline. Of these, the RP has so far admitted claims worth Rs 14,054 crore.
Source: Financial Express, September 26, 2019