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Lenders of Jet Airways have cited at least eight letters since November last year sent by the Jalan Kalrock Consortium (JKC) and have disclosed the minutes of crucial meetings held between July to November 2022 to buttress their claim that the consortium has not complied with the conditions required to fulfill the resolution plan.
While the lenders have also accused Jalan Kalrock of trying to usurp control of the airline without completing the conditions, court documents accessed by businessline show that JKC has blamed the lenders for trying to renegotiate the resolution plan, delay it and purposefully edit the minutes of a meeting.
Access to court documents from both sides show that both parties have unresolved grievances, casting a dark cloud over Jet Airways revival.
The Mumbai Bench of NCLT has started hearing the Jet Airways ownership matter between Jalan Kalrock Consortium (JKC) and the lenders on Monday. Justice Pradeep Narhari Deshmukh and Sh. Shyam Babu Gautam heard JKC’s arguments on Monday will now hear the matter on December 14.
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businessline had reported quoting internal documents that the lenders had alleged that only two of the five conditions precedents were met by JKC.
The first condition was to obtain the AOC. According to the lenders and JKC, this condition was met. The second condition was to get an approval of the business plan from the Ministry of Civil Aviation and Directorate-General of Civil Aviaion.
According to the lenders, this condition hasn’t been met. The lawyers appearing on behalf of JKC said that as per the rules, the AOC cannot be granted unless the business plan has been approved by the concerned party.
The other condition was regarding slot allocations for Jet Airways. businessline had reported that JKC was able to get approvals for slots at Hyderabad, Bengaluru , Nagpu, and Kochi airports. However, the lenders have opposed stating that JKC hasn’t received slots in primary hubs of Delhi and Mumbai.
Airport slots
The consortium has attached letters from Mumbai and Delhi airports stating that while they are happy to allot slots to Jet Airways, the pending dues needed to be cleared. The consortium said that it was able to repay 40 per cent of the dues. To which the lenders said the consortium has not taken “enough efforts” to regain those slots.
The lenders also pointed out that the consortium was unable to get the rights to fly internationally.
A response letter issued by the MoCA in May said that under the National Civil Aviation Policy, 2016 an airline can commence international operations provided it deploys 20 aircraft or 20 per cent of total capacity (in terms of average number of seats on all departures put together), whichever is higher, for domestic operations.
“For this purpose, the published schedule of airlines will be the basis for monitoring, assuming that one aircraft would have six departures per day. Further, Para 2 of AIC 10/2022 on the Guidelines for Grant of Permission to Indian Air Transport Undertakings for Operation of Scheduled International Air Transport Services issued by the Directorate General Clf Civil Aviation dated 19.04.2022 prescribing the Eligibility Criteria may also be referred. The application of Jet Airways, if it has a valid AoC and fulfills the above criteria, will be examined for international scheduled operations at appropriate time,” it said.
In response, the lenders claimed that the consortium had said it was in conversation with multiple airlines for codeshare, including Delta Airlines for the Summer 2022 schedule. It further added that Jet had plans to order 50 aircraft, and wanted to restart operations in Amsterdam, Abu Dhabi, London (Heathrow) and Dubai airports. A copy of this response by the lenders has been reviewed by businessline.
“Therefore, the acts of assurances and updates ”to the lenders “of the works in progress towards the procurement of international traffic rights clearance throughout the Resolution Plan implementation process, do not reconcile” with the contention of the consortium that the “requirement to obtain such clearance ‘is not applicable at this stage’,” it said.
Ankit Jalan, representative of JKC , has written an email on November 1, 2022 alleging that the lenders have produced different final minutes of the meeting after the NCLAT order directing that the provident fund and gratuity of the employees, which was to the tune of ₹250 crore, had to be paid.
“We are shocked to receive the signed JLM minutes as the said version is different from the draft minutes shared by SBI with us previously on October 10, 2022 and October 15, 2022 as the last shared version does not adequately reflect the discussions to which the SRA was part of. Email, along with the draft minutes received from SB, is enclosed.
“We put on record that the matters as captured in the attached minutes do not reflect the discussions held during the JLM of September 29, 2022 and it seems that some paragraphs have been added in the minutes as an afterthought, most likely after having gone through the judgment of the NCLAT dated October 21, 2022,” it said. A copy of this letter has been reviewed by businessline.
The consortium has alleged that the conversation of an ‘undertaking’ from the consortium was never discussed during the said meeting. In fact, the lenders had said that pertaining to compliance of Conditions Precedent (CPs), all lenders will collectively and positively support the next step of the plan.
The lenders, in their response to the NCLT, have said that “the minutes of the MC Meeting dated November 2, 2022 are self- explanatory, and that the document will speak for itself. It is submitted that the Hon’ble NCLAT, vide order dated December 2, 2022, has explicitly clarified that the amounts due to the workmen / employees of the corporate debtor are to be paid by the applicant in addition to the amounts stipulated under the Resolution Plan as the same were not envisaged in the said plan, and which was communicated to the applicant in the 2nd November 2022 MC meeting as well,” it added.
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