<b>Bombay HC allows Jet to withdraw Rs 1,500cr</b>

The Bombay High Court today allowed private carrier Jet Airways to withdraw Rs 1,500 crore deposited by it in an escrow account for acquiring rival Air Sahara against a bank guarantee of the same amount.

Passing an interim order in all the four cases related to the failed Jet-Sahara merger, Justice D K Deshmukh ruled: "Jet Airways will have the right to withdraw Rs 1,500 crore against a bank guarantee of the same amount."

The amount in the escrow account, maintained at ICICI's Nariman Point branch here, will be returned to Jet and the interest accrued on the same will go to Air Sahara.

The remaining formalities regarding the escrow account and all other related disputes will be decided by the arbitration tribunal.

Speaking to reporters outside the court, Jet lawyer Harish Salve said Jet Airways will submit the bank guarantee (for the same amount) on Monday.

"Now Jet has got the right to withdraw the amount in the escrow account. This is an interim order, which shall be modified subjected to the arbitration tribunal's decision," he said.

The arbitration tribunal consists of Retd Chief Justices S P Bharucha, Jeevan Reddy and Lord Stein. It will hear the case on October 9.

Jet Airways, in January this year, had signed an agreement to acquire 100% equity stake in Air Sahara.

As part of the deal, Jet had paid Rs 180 crore for the revival of Air Sahara and Rs 500 crore for Air Sahara shares besides depositing Rs 1,500 crore in the escrow account opened for the purpose.

After the deal fell through - as Jet failed to get regulatory clearances by the deadline of June 21 as per the agreement - Sahara moved a court in Lucknow seeking to bar Jet from operating the escrow account.

The Supreme Court had, in August, transferred two petitions filed by Sahara in a Lucknow court to the Bombay High Court for hearing. Jet had already filed two separate petitions before the Bombay High Court.

"With respect to various clause of the Escrow, Pledge and Guarantee agreement, we are of the view that ends of justice will be met at one court, namely Bombay High Court," the Supreme Court had said.