SpiceJet seeks Supreme Court approval to submit land title as security

New Delhi: Cash-strapped low-cost carrier SpiceJet and its chairman and managing director Ajay Singh have moved the Supreme Court seeking permission to furnish a title deed for a plot of land instead of depositing ₹144 crore in an arbitration dispute with former promoter Kalanithi Maran and KAL Airways.

SpiceJet has challenged the Delhi High Court's May 4 and March 18 orders rejecting its request to furnish an unencumbered plot of land in Gurugram as security. The HC had directed the airline to immediately comply with its earlier order to deposit the amount and imposed a cost of ₹50,000 for repeatedly seeking modification of the deposit direction.

On January 19, the high court directed SpiceJet and Singh to deposit ₹144 crore with the court registry within six weeks against an admitted liability of ₹194 crore. On March 18, the court extended the deadline by four weeks.


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The airline later sought permission to submit Gurugram land valued at ₹148 crore as security instead of making a cash deposit, but the plea was rejected by the HC.

The high court also dismissed SpiceJet's argument that it was facing a liquidity crunch due to cancellation of flights to the Gulf region amid the recent West Asia conflict. Justice Subramonium Prasad observed that the hostilities in West Asia began only this February, while the Supreme Court had, in July 2023, made it clear that the arbitral award would become executable if SpiceJet failed to comply with payment directions.

The dispute stems from a share transfer deal between Singh and Maran along with KAL Airways. In February 2015, Maran and KAL Airways transferred their 58.46% stake in SpiceJet to Singh.

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In 2017, Maran and KAL Airways approached the Delhi High Court seeking transfer of 180 million warrants redeemable as equity shares. Earlier, on July 29, 2016, the court had directed the parties to resolve the dispute through arbitration.

On July 20, 2018, the arbitral tribunal rejected Maran's ₹1,323 crore damages claim over non-issuance of warrants but awarded a refund of ₹579 crore along with interest.

Maran subsequently challenged the arbitration award before the high court after it rejected his damages claim and his bid to regain control of the airline. The HC directed SpiceJet and Singh to deposit ₹579 crore, permitting a bank guarantee of ₹329 crore and a cash deposit of ₹250 crore. The Supreme Court dismissed SpiceJet's appeal against the order in July 2017, though the order was later stayed.