NCLT asks Synergy Group to show its bonafide intent to revive Jet Airways

The Mumbai Bench of National Company Law Tribunal (NCLT) yesterday directed the Synergy Group to appear before the Tribunal and show its bonafide intent with respect to the bid for grounded Jet Airways.

In this regard, the Tribunal directed the Resolution Professional (RP) to persuade the Synergy Group to present its plan and intent during the hearing slated after two weeks.

The Synergy Group, a significant stakeholder in the Columbian Avianca Airlines, is currently the only party participating in the resolution of Jet Airways and has submitted an Expression of Interest (EoI).

A Bench of Judges Bhaskara Pantula Mohan and Rajesh Sharma has been hearing the insolvency proceedings against Jet Airways.

Ashish Chhawchharia, Resolution Professional (IRP) for the airline informed the Tribunal that the Synergy Group had sought additional time until February next year to finalize its plans for Jet Airways.

He further told the Court that Synergy Group was the only serious bidder and has been regularly keeping track of the Corporate Insolvency Resolution Process (CIRP).

After perusing the submissions, the Bench said,

“We want the resolution professional to persuade the bidder to appear for the next hearing or any date earliest possible.”

The Bench said that during the next hearing, it will ascertain whether the Synergy Group has bonafide intent to participate in the resolution of Jet Airways.

It was further informed by the IRP that the Committee of Creditors (CoC) for Jet Airways, which had granted time to the Synergy Group until November 15, will meet on Tuesday, November 19 to take a call on extension till next month.

The Airline has been grounded for over seven months and the insolvency plea by State Bank of India led consortium was admitted on June 20, this year. The 180-day deadline for completing CIRP will end on December 16.

Citing the ‘national importance’ of the issue, the NCLT, while admitting the plea on June 20 had also asked the resolution professional to give fortnightly reports. Further, it had directed that the process be completed expeditiously within three months, instead of 180 days prescribed in the Insolvency and Bankruptcy Code (IBC).

Moreover, the NCLT, on Monday directed that the Ministry of Civil Aviation and Directorate General Civil Aviation (DGCA) be made parties to the ongoing resolution proceedings and provide clarity on Jet’s slots for the summer schedule.

The summer schedule starts from the last Sunday of March until the last Saturday of October. The DGCA has already finalized its winter schedule last month.

It was informed to the Tribunal that the return of slots earlier allotted to Jet Airways, which have been redistributed among other airlines, was discussed during the meetings held by Synergy Group with Government, lenders, and management of the Jet Airways.

In light of this, the NCLT has asked to implead the DGCA and Ministry of Civil Aviation and sought their response on the Jet’s slots during the next hearing.

Jet Airways owes over Rs. 8,000 crores to lenders, including the consortium of banks led by the State Bank of India. The grounded airline also has a large debt by way of accumulated losses to the tune of Rs. 13,000 crore and vendor dues of over Rs. 10,000 crores, apart from salary dues of over Rs. 3,000 crores.

The Tribunal will hear the matter next on December 3.