Jet Airways hits 5% upper circuit after NCLAT approves ownership transfer to Jalan Kalrock

JKC and SBI-led Consortium have blamed each other for not letting the airline take off.

While JKC had transferred Rs 200 crore to the lenders’ account by September 2023, it had won a favourable order from NCLAT for adjustment of the performance bank guarantee of Rs 150 crore. The order was later overturned by the Supreme Court, which asked JKC to deposit Rs 150 crore by January 31.

The apex court also directed that the performance bank guarantee (PBG) of Rs 150 crore would continue to remain in operation till the NCLT decides the petitions.

A Chief Justice-led Bench asked NCLAT to decide whether the successful applicant has complied with all conditions in the resolution plan and also urged the tribunal to expedite insolvency petitions by March-end.

The lenders had claimed that even the second tranche of Rs 100 crore that was invested by JKC did not come out of a specific account, in violation of the terms of the agreement.

JKC won the bid to operate the airline under a bankruptcy process led by SBI, but since then it has been unable to take ownership of the airline. The consortium has spent over Rs 300 crore for hiring executives to do probing flights, which are an essential part of keeping its air operator's certificate active.

The process also hit a hurdle last year when the SC directed the consortium to pay provident fund and gratuity dues worth Rs 248 crore of the grounded airline's former employees.

Shares of Jet continued bleeding this year with a loss of 25% year-to-date following multiple troubles and uncertainty around JKC takeover.