Delhi High Court upholds Arbitral Award in favour of Kalanithi Maran against SpiceJet

 In a significant ruling, the Delhi High Court on Monday refused to intervene with the 2018 Arbitral Award, which ordered SpiceJet and its promoter Ajay Singh to refund Rs 579 crore plus interest to former promoter Kalanithi Maran. 

The bench, presided over by Justice Chandra Dhari Singh, upheld the arbitral award passed on July 20, 2018, in favour of Kal Airways and Maran.

The Arbitral Award granted decree holders Kal Airways and Kalanithi Maran a refund of Rs. 308 crore for the warrants and Rs 270 crore for cumulative redeemable preference shares (CRPS). Additionally, they were awarded an interest of 12 per cent for pendente lite and 18 per cent from the last due date in case SpiceJet and Mr. Ajay Singh fail to make the payments within two months from the award date.

SpiceJet and Ajay Singh had filed a petition seeking the annulment of the award. However, the Delhi High Court dismissed the petition on Monday, stating that there were no grounds to interfere with the arbitral award.

The legal dispute dates back to January 2015, when Ajay Singh, the present owner of SpiceJet, bought back the airline from Kalanithi Maran after it was grounded for months. In 2017, Maran and KAL Airways moved the Delhi High Court, demanding that 180 million warrants, redeemable as equity shares, be transferred to them.

In July, the Supreme Court directed SpiceJet to pay the entire arbitral amount of Rs 380 crore to Maran, emphasising that business must be conducted with "commercial morality."

Maninder Singh, senior advocate instructed by Nandini Gore- senior partner, Sonia Nigam- principal associate & Yash Dubey- associate and Akarsh Sharma, associate advocates from Karanjawala & Company appeared on behalf of the Kal Airways Pvt Ltd and Kalanithi Maran whereas Abhinav Vashisht, senior advocate along with Mr. Atul Sharma, advocate appeared on behalf of the SpiceJet Ltd and Ajay Singh.

The ruling in favour of Kalanithi Maran and Kal Airways highlights the complexities and legal challenges involved in corporate disputes and reinforces the importance of honouring arbitral awards in commercial agreements.

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