Delhi High Court orders SpiceJet to return leased aircraft, engines to TWC

SpiceJet, which currently owes $14 million to TWC, had its offer to pay $435,000 a month to clear its dues rejected

The Delhi High Court has directed SpiceJet to comply with a United Kingdom court order, mandating the return of two leased aircraft and three engines to TWC Aviation Capital (TWC). This decision follows allegations that SpiceJet had removed the engines from the leased aircraft and used them in other planes, according to a report by LiveLaw.

In her ruling, Justice Prathiba M Singh noted the significant damage caused by the separation of engines from the aircraft, which were leased by TWC to SpiceJet.

“The separation of engines from the aircraft in this manner may not even be permissible. The aircraft frames and engines being used separately would considerably reduce the value of these aircraft for the plaintiff. The dues are not forthcoming from the defendant,” Justice Singh said.

In an earlier interim order in April 2024, TWC was permitted to take possession of the aircraft as a receiver, while SpiceJet was allowed to use the engines. However, the latest directive mandates the unconditional return of both the aircraft and engines to TWC.

“This Court has no option but to direct that the aircrafts along with the engines, along with all relevant records relating to technical condition and usage of aircrafts, shall be handed over to the Plaintiff by 28th May, 2024,” the Court ordered, citing SpiceJet’s failure to pay lease rent dues.

TWC Aviation initiated the legal proceedings to enforce two orders issued in March 2024 by a UK court, which directed SpiceJet to return the leased aircraft and engines. TWC claimed ownership of two Boeing 737-800 aircraft and three engines leased to SpiceJet under an agreement dated May 27, 2019, for 12-month at a basic rent of $180,000 per month.

SpiceJet currently owes $14 million to TWC. The airlines had offered to pay $435,000 a month to clear its dues. However, TWC had rejected this offer, according to a report by Mint. Despite amendments to the agreement to accommodate payment difficulties due to the Covid-19 pandemic, SpiceJet breached the terms, leading TWC to seek legal redress in London.

The UK Court’s March orders instructed SpiceJet to return the leased aircraft and engines to TWC. When SpiceJet failed to comply, TWC approached the Delhi High Court, filing a civil suit to enforce the UK Court’s orders.

The Delhi High Court upheld the maintainability of the suit and granted interim relief to TWC. “Prima facie, the orders passed by the UK court are enforceable in these proceedings in terms of Section 13 read with Section 44A of the CPC. The Defendant (SpiceJet) has already had an opportunity to defend itself in the UK Courts,” the Court noted. The matter is scheduled for further hearing on May 31.