Delhi High Court rejects SpiceJet’s review petition against order to deposit ₹144 crore

The Delhi High Court on Monday rejected the review petition filed by SpiceJet airlines and its managing director Ajay Singh against an order requiring the airline to deposit ₹144 crores in connection with a long-running arbitration dispute with Kalanithi Maran and KAL Airways Pvt Ltd [SpiceJet Vs Kal Airways].

SpiceJet had offered property belonging to Singh for attachment instead of having to deposit the ₹144 crores.

However, Justice Subramoniun Prasad today rejected the review petition and also imposed costs of ₹50,000 on SpiceJet.

"Application dismissed with cost of ₹50,000," the Court directed.

The matter is rooted in a dispute from 2015, involving the rescue of SpiceJet when it was facing severe financial distress and risked shutting down operations.

Kalanithi Maran and Kal Airways were the promoters and majority shareholders of the airline, holding 58.46 per cent stake. They entered into a Share Sale and Purchase Agreement (SSPA) with SpiceJet in January 2015. Under this SSPA, Maran and Kal Airways agreed to transfer their entire shareholding to Ajay Singh for a nominal consideration of ₹2.

The transaction was coupled with a broader financial support arrangement involving the issuance of warrants and cumulative redeemable preference shares (CRPS) and an overall funding commitment of about ₹450 crore. Disputes later arose over the performance of reciprocal obligations under the SSPA, leading to arbitration.

In July 2018, a three-member arbitral tribunal directed SpiceJet and Ajay Singh to refund ₹308.21 crore to Maran and KAL Airways, along with interest at 12 per cent per annum from November 2015.

Both sides filed challenges under Section 34 of the Arbitration and Conciliation Act, 1996, while enforcement proceedings were initiated in parallel.

The enforcement proceedings saw several rounds of litigation before the Delhi High Court and the Supreme Court.

The High Court eventually directed SpiceJet to deposit ₹579 crore in interim proceedings. This was modified in appeal to permit a ₹329 crore bank guarantee and a ₹250 crore cash deposit. In 2019, ₹250 crores was released to the decree holders, and a further ₹58.21 crore was paid from the bank guarantee.

In February 2023, the Supreme Court directed encashment of the bank guarantee and ordered SpiceJet to pay ₹75 crores towards interest within three months, warning that failure to comply would render the award executable in its entirety.

In July 2023, the Court refused to grant further time and held that the award had become executable due to non-compliance.

In January 2026, the Delhi High Court dealt with applications filed by SpiceJet and Ajay Singh seeking a stay on the award. The Court noted that the Supreme Court’s directions had not been complied with.

The High Court also recorded that the judgment debtors had themselves admitted in earlier proceedings that ₹194.51 crores remained payable towards interest, of which ₹50 crore had already been deposited.

Accordingly, the Court directed the deposit of the remaining ₹144.51 crore within six weeks. SpiceJet filed the review petition challenging this order.

In February, the Supreme Court dismissed a similar plea by SpiceJet and Ajay Singh challenging this direction to deposit ₹144 crores.

SpiceJet then filed an application by which it offered property belonging to Singh for attachment.

Representing the airline, Senior Advocates Mukul Rohatagi and Amit Sibal submitted that the company was facing financial difficulties and that a deposit of ₹144 crores would create problems for the company, especially due to the war in Iran and its effects on airline industry.

Rohatgi stated that the Central government is in the process of granting sovereign credit called Emergency Credit Like Guarantee Scheme to cushion the effect of West Asia war on the airline industry. He also submitted that they will make an endeavour to sell the property.

Senior Advocate Jayant Mehta, appearing for KAL Airways and Kalanithi Maran, countered that the Supreme Court has already rejected such requests by SpiceJet.

He pointed out that the top court had even imposed ₹1 lakh as costs while dismissing SpiceJet's challenge to the directive to deposit ₹144 crores. Mehta added that Ajay Singh’s Gurugram property is encumbered with the IDFC Bank.

After considering the submissions, the Court refused to entertain SpiceJet's plea and ordered it to pay up the ₹144 crore deposit within four weeks.

Senior Advocate Jayant Mehta with advocates Nandini Gore (Senior Partner), Sonia Nigam (Associate Partner), Swati Bhardwaj, Akarsh Sharma, Arjun Singh Gautam and Mansvini Jain from Karanjawala & Co. appeared for Kal Airways and Kalanithi Maran. 

Senior Advocates Mukul Rohatagi and Amit Sibal along with advocate Sasiprabhu, Yasharth Misra, Darpan Sachdeva, Mohammed Ilyas, Parth Rashik and Vidhatri Devoli appeared for SpiceJet and Ajay Singh.