Supreme Court orders Jet Airways liquidation after failed resolution
India’s Supreme Court has ordered the liquidation of Jet Airways, marking the end of a protracted five-year effort to revive the airline through insolvency proceedings. The court’s decision on November 7, 2024, came after the Jalan-Kalrock Consortium (JKC), which had been approved to take over Jet Airways in 2021, failed to implement the resolution plan.
Jet Airways, once India’s largest privately-owned airline, ceased operations in April 2019 due to mounting debts totaling approximately $1.2 billion. In June 2021, the National Company Law Tribunal (NCLT) approved a resolution plan submitted by JKC, comprising UAE-based businessman Murari Lal Jalan and UK-based Kalrock Capital. However, the consortium faced ongoing legal challenges and disputes with creditors, leading to significant delays in reviving the airline.
The Supreme Court’s ruling found that JKC had not fulfilled the conditions of the resolution plan, including the infusion of necessary funds and obtaining requisite approvals. The court described the National Company Law Appellate Tribunal’s (NCLAT) earlier decision to allow ownership transfer without payment to creditors as “perverse and unsustainable in law.” Consequently, the court directed the initiation of liquidation proceedings for Jet Airways.
This decision effectively ends any prospects of reviving Jet Airways, which had been grounded for over five years. The liquidation process will involve selling the airline’s assets to repay creditors, who are expected to recover only a fraction of their dues. Reports suggest that creditors may receive around ₹1,000 crore from the liquidation, a small portion of the total outstanding
The collapse of Jet Airways underscores the challenges faced by India’s aviation sector, including intense competition, high operational costs, and regulatory hurdles. The liquidation of Jet Airways follows similar fates of other Indian carriers like Kingfisher Airlines and more recently, Go First, highlighting the volatility in the industry.
