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Spicejet and its promoter Ajay Singh Wednesday approached the Delhi High Court challenging a single-judge order upholding an arbitral award asking them to refund Rs 579 crore plus interest to media baron Kalanithi Maran.
The appeals came up before a division bench of Justices Yashwant Varma and Dharmesh Sharma which initially listed it for hearing on September 15 as the counsel for Spicejet and Singh were not present.
Later, Spicejet’s counsel mentioned the matter before the bench which then listed it for hearing on Thursday.
On July 31, the single judge had upheld the award announced by the arbitration tribunal on July 20, 2018 in favour of Maran and his company Kal Airways.
There is nothing in the impugned award to suggest that it suffers from patent illegality and the findings therein are perverse and will shock the conscience of this court.
“In the instant case, the petitioners have not been able to prove that the impugned arbitral award is patently illegal, against public policy of India or fundamental policy of law and thus have failed to make out a case for the award to be set aside, the single judge bench had said in its verdict.
It had said the court was barred from entering into the merits of an award unless there was an error that was apparent on the face of the record or an illegality that goes to the root of the matter.
Ajay Singh had approached the high court challenging the arbitral award.
The high court had said the petitioners had failed to substantiate the grounds for setting aside the arbitral award and dismissed the two petitions by Spicejet and Ajay Singh.
The case dates to January 2015, when Singh, who owned the airline earlier, bought it back from Maran after it was grounded for months due to resource crunch.
While the tribunal had asked Maran to pay Singh and the airline Rs 29 crore in penal interest, Singh was asked to refund Rs 579 crore plus interest to Maran.
The tribunal, created in 2016 on the orders of the Delhi High Court to adjudicate the share transfer dispute, had held that there was no breach of a share sale and purchase agreement reached between Maran and current promoter Ajay Singh in late January 2015.
In a relief to Ajay Singh, the tribunal had, however, rejected Maran’s appeal for damages of Rs 1,323 crore from the Gurugram-based carrier.
In February 2015, Maran of the Sun Network and Kal Airways, his investment vehicle, had transferred their 58.46 per cent stake in SpiceJet to Singh for Rs 2 along with Rs 1,500 crore debt liability, after the airline was grounded due to a severe cash crunch. Singh was the first co-founder of the airline and is now its chairman and managing director.
As part of the agreement, Maran and Kal Airways had claimed to have paid Spicejet Rs 679 crore for issuing warrants and preference shares. However, Maran approached the Delhi high court in 2017, alleging SpiceJet had neither issued convertible warrants and preference shares nor returned the money.
(Only the headline and picture of this report may have been reworked by the Business Standard staff; the rest of the content is auto-generated from a syndicated feed.)
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