PT BBN Airlines moves NCLT to start insolvency proceedings against SpiceJet
This story was originally published at 13:48 IST on 21 March 2025
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NEW DELHI – PT BBN Airlines Ltd. has moved the Delhi bench of the National Company Law Tribunal to start insolvency proceedings against SpiceJet Ltd. During the hearing on Friday, SpiceJet opposed PT BBN Airlines' plea and requested the tribunal to not issue any notice in the case. Noting that SpiceJet has made a "strong argument" about not issuing a notice, the tribunal said it will hear the case next on Apr. 21.
The case has its genesis from SpiceJet leasing a bunch of aircraft from Indonesian carrier BBN Airlines. PT BBN Airlines said that $5.94 million were due from the airline between May 2024 and September 2024, and the same had been acknowledged by SpiceJet.
SpiceJet said that BBN Airlines has wilfully misrepresented material facts in its demand notice. BBN Airlines has misconstrued the provisions of the lease agreements and deliberately concealed material facts, said SpiceJet. BBN Airlines has concealed the reason for repeated delay by BBN Airlines in delivering the aircraft, SpiceJet said.
SpiceJet said the delivery of one of the aircraft was initially scheduled in March last year. However, on account of delay caused by BBN Airlines, this delivery was not as per the timeline provided in the lease term agreement.
As a direct consequence of repeated delays on the part of BBN Airlines in delivering the aircraft, it had incurred substantial financial losses, including loss of revenue due to flight cancellations, and damage to its reputation among passengers, said SpiceJet.
SpiceJet said that despite the fulfillment of all obligations by it under an early termination agreement dated Aug. 28, 2024, BBN Airlines failed to take possession of the aircraft from base of operations. Subsequently, BBN Airlines wrongfully terminated the early termination agreement in September, which clearly shows its malafides, it said.
As per the lease agreement between the parties, it was upon BBN Airlines to bear the cost of taking back the aircraft from base of operations to the base of lessor, said SpiceJet. However, in order to shift the burden of costs, BBN Airlines misrepresented an event of default, to take undue advantage of one of the clauses of the lease agreement.
At 1250 IST, shares of SpiceJet were up 0.8% at INR 48.92 on the BSE. End
US$1 = INR 86.02
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Reported by Surya Tripathi
Edited by Tanima Banerjee
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