The revival of Jet Airways faces another hurdle as lenders, led by State Bank of India, demand the Jalan-Kalrock Consortium (JKC) to present the essential Air Operator Certificate (AOC). This request emerged during a hearing at the National Company Law Appellate Tribunal (NCLAT), where the Committee of Creditors (CoC) contested the ownership transfer to JKC.
The lenders’ insistence on obtaining the AOC highlights their conditions for restarting Jet Airways. They expect JKC to furnish the certificate at the next hearing as evidence of their commitment to reviving the grounded airline.
Concerns have been raised in previous hearings regarding the funding sources of JKC and alleged money laundering activities, particularly concerning investor Florian Fritsch, who is currently under investigation for fraud by European entities.
The court has postponed the hearing to 11 December, emphasizing that further delays will not be tolerated, and the case will be prioritized on that date.
In July, the Directorate General of Civil Aviation (DGCA) had conditionally extended Jet Airways’ AOC until 3 September, limited to facilitating the Corporate Insolvency Resolution Process (CIRP). JKC asserts that the flying permit is in place and remains valid until the consortium initiates flight operations.
During the recent hearing, additional solicitor general N Venkataraman, representing the lenders, highlighted the complexities of the case. He cited JKC’s continuous legal maneuvers, including a request for the return of a ₹200 crore deposit and simultaneous appeals for an urgent hearing at the Supreme Court.
JKC has stated that the funds sought are for equity issuance in the airline, an action not yet executed by the lenders.
On 29 September, JKC announced that it had fulfilled the financial commitment of ₹350 crore and expressed determination to resume airline operations in 2024. The consortium completed the transfer of money to the lenders as per NCLAT’s directive instruction. According to the payment schedule approved by the NCLAT on 28 August, JKC was required to pay ₹200 crore to the lenders. The NCLAT had instructed them to pay the due amount of ₹350 crore by 30 September, with ₹150 crore to be encashed from the performance bank guarantee.
However, lenders raised concerns about the consortium’s source of funding, hinting at potential money laundering on 4 October.
Jet Airways ceased operations in April 2019 due to financial difficulties, and the ownership transfer has been in limbo amid ongoing disputes between the lenders and the consortium. The NCLT approved the resolution plan for Jet Airways on 22 June 2021.