 "Jet Airways")
The clock is ticking for Jalan-Kalrock Consortium (JKC) as its 180-day deadline to pay off the creditors and employees of the grounded erstwhile Jet Airways is now less than four weeks away.
National Company Law Tribunal (NCLT) had given the consortium of Dubai-based entrepreneur Murari Lal Jalan and the UK's Kalrock Capital six months from when the resolution plan had come into effect (November 16, 2022) to settle the dues.
In addition to payments, JKC owes Rs 185 crore to the lenders of Jet Airways. The consortium is also to pay an estimated amount of Rs 250 crore to the airline’s former employees by May 14.
In April 2019, Jet Airways was grounded over rising financial liabilities of about Rs 8,000 crore. The airline's Committee of Creditors (CoC), in October 2020, approved the consortium's revival plan.
On January 13, 2023, the order of the NCLT noted that JKC fulfilled all conditions necessary for the ownership transfer of the airline. Following this, the leaders of the airline approached the NCLAT to oppose the ownership transfer.
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If the consortium fails to meet the NCLT deadline, it will not get the airline's ownership. The expiry of Jet Airway's air operator’s permit (AOP) is also due on May 19.
So now the consortium will either have to renew it before the expiry date, or they will have to reapply with Directorate General of Civil Aviation (DGCA).
According to a Financial Express report, the DGCA had sent a notice to Jet Airways in February to know if they have the intention of starting the operations. "They had assured the regulator that required funds were being arranged. But nothing changed," the report said citing sources.
JCK did not reply to FE's email seeking updates on the company’s plans.
An industry expert told FE that it takes 1-2 months to begin flight operations and before that happens the airline needs to take slots, arrange ground handling, and aircraft parking and then commence bookings.
"Just to take a slot takes two months. The Delhi-Mumbai route will have no slots available now,” the industry expert said.
The former head of the airline told FE that JCK will only have to follow the process if the are able to renew the AOP, however, f they fail to do so, it takes 6-9 months.
“It takes 6-9 months for a new operator to meet the requirements for the AOP. It will not be difficult to renew Jet’s AOP since everything has already been approved. They have to only follow the process,” he said.
Jet Airways got its AOP in May 2022 with two aircraft in its fleet. Although currently, the company has only one aircraft, a Boeing 737-800, according to DGCA.
Jet Airways had planned to commence commercial operations around September-October last year as a full-service carrier. However, the airline could not change ownership due to the continuous protest of the lenders.
According to the report, JKC has been showing a strong reluctance in infusing funds beyond the Rs 1,375 crore as was mentioned in the resolution plan. It includes Rs 475 crore payments to creditors, of which Rs 380 crore is earmarked for the financial creditors, and the balance as a capital infusion.
