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Kalanithi Maran and his firm KAL Airways have announced their intent to seek damages exceeding ₹1,323 crore from SpiceJet and its chief, Ajay Singh. This decision comes in the wake of the recent Delhi High Court order, which they plan to challenge.
Last week, SpiceJet indicated its intention to seek a refund of ₹450 crore out of the ₹730 crore paid to its former promoter Kalanithi Maran and KAL Airways. However, Maran and KAL Airways responded by stating that they will challenge the court’s decision and pursue significant damages.
The ongoing dispute took a significant turn on May 17 when a division bench of the Delhi High Court set aside a single judge bench order. The initial order had upheld an arbitral award requiring SpiceJet and Ajay Singh to refund ₹579 crore plus interest to Maran. The division bench’s decision to allow the appeals by Singh and SpiceJet has remanded the matter back to the concerned court for a fresh review of the petitions challenging the arbitral award.
Following consultations with their legal counsel, Maran and KAL Airways decided to contest the ruling. According to a statement released on Monday, the decree holders believe the judgement is “deeply flawed and warrants further scrutiny.”
The damages claim, totaling over ₹1,323 crore, has been evaluated by FTI Consulting LLP, a UK-based firm specializing in loss estimation due to contractual breaches. This claim has been a consistent element of Maran and KAL Airways’ legal strategy, initially presented before the arbitral tribunal.
Maran and KAL Airways’ statement emphasized their determination to achieve a just resolution. They intend to pursue both the challenge to the Delhi High Court judgement and the claim for damages concurrently. The dispute has reportedly caused significant hardship for Maran and KAL Airways over the past decade due to alleged breaches of trust by SpiceJet.
In addition to seeking damages, Maran and KAL Airways are also pushing for the execution of the arbitral award, demanding a refund of pending dues amounting to ₹353.50 crore. This pursuit aligns with Supreme Court orders from February 13, 2023, and July 7, 2023, which directed the execution of the award in favor of the decree holders.
On May 22, SpiceJet announced its plan to seek a refund of ₹450 crore from the ₹730 crore paid to Maran and KAL Airways. The case’s roots trace back to early 2015 when Ajay Singh, who previously owned SpiceJet, reacquired the airline from Maran after it faced significant financial difficulties. As part of their agreement, Maran and KAL Airways claimed to have paid SpiceJet ₹679 crore for issuing warrants and preference shares. However, in 2017, Maran approached the Delhi High Court, alleging that SpiceJet failed to issue the promised convertible warrants and preference shares or return the money.
Sources By Agencies
