Delhi HC seeks SpiceJet's response on lessor's offer to re-deliver a leased engine

The Delhi High Court on Monday sought SpiceJet’s stand on its lessor Engine Lease Finance BV's offer that the airline should re-deliver one leased engine on "as is where is basis" and the same would not prejudice the lessor’s rights in claiming compensation and damages from the low-cost carrier.

Directing the SpiceJet's senior counsel to take instructions from the airline if they can deliver the engine in terms of clause 20 of the 2017 Aircraft Engine General Agreement, the high court asked the airline to inform it about its stand on Wednesday.

While the lessor's counsel told the court that the airline will be liable to compensate and pay cost associated with the delivery of the engine and also putting the engine back into the redeliverable state, the HC asked SpiceJet if the same was acceptable to the airline, then the lessor would withdraw its application and restrict the case to compensation and damages only.


Engine Lease Finance had last month claimed that the engine it had leased to the airline was currently in an unserviceable condition and not capable of being delivered back in Europe. However, Spicejet had rejected the lessor’s allegations, saying the engine's condition had deteriorated due to wear and tear.

The lessor had moved the high court in September seeking direction to the airline to return the engine. Later in October, both the parties had decided to resolve their dispute amicably in terms of an interim settlement under which the airline had agreed to pay over $2 million to the lessor.

However, in December, Engine Lease Finance alleged that SpiceJet failed to make payments and even had not returned its last of the nine engines.