The Jalan-Kalrock consortium, winning bidder of Jet Airways, has moved the National Company Law Appellate Tribunal (NCLAT), saying provident fund and gratuity dues of Jet employees should be paid from the airline’s existing cash balance and the rest from the lenders’ share.
On October 21, the appellate tribunal had directed the consortium to pay gratuity and provident fund to the airline’s employees till the date of insolvency commencement in June 2019. The total claim is around ₹275 crore.
The banks – which are already taking around 95% haircut as part of the resolution process – have not agreed to share the burden of payment of PF and gratuity dues, raising new question marks over the two-year-old resolution deal.
The Jalan-Kalrock consortium (JKC) has said it is not liable to pay anything extra beyond the ₹475 crore to creditors and all claims have to be settled within that.
All additional claims that haven’t been factored in the approved resolution plan are to be settled from the cash balance of the airline, which is around ₹50 crore, and the remaining from the share of banks, it said.
“JKC’s total liability towards the erstwhile creditors of Jet Airways is capped at ₹475 crore. Source and manner of payments are already laid down clearly under the resolution plan, which has been approved by Jet Airways lenders, NCLT, and NCLAT,” a spokesperson for the consortium told.
Jalan-Kalrock had won the bid to restart the bankrupt airline under a bank-run insolvency process in 2020 but since then it failed to make much progress as differences have cropped up between the lenders and the consortium over payment issues. Legal challenges by employees have also delayed the process.
Executives of lenders involved in the process also said the consortium has not paid the first tranche of ₹185 crore to lenders, but laid claim to the lease rentals accrued from Air Serbia to which Jet had leased one Airbus A330 aircraft.
The consortium proposed to pay ₹1,375 crore for the carrier, which included ₹475 crore to pay stakeholders, and ₹900 crore to be used as working capital and capital expenditure.
The plan requires the consortium to pay ₹185 crore upfront within 180 days, the deadline for which ends on November 29.
Lenders are unlikely to hand over the airline to the consortium without receiving their first tranche of payment.