End of lifeline: Supreme Court orders liquidation of Jet Airways over failure to implement resolution plan 

The Supreme Court on November 7 ordered the liquidation of defunct airline Jet Airways as per the Insolvency and Bankruptcy Code (IBC) following the failure of the airline’s resolution plan to be implemented over a span of five years. 

A Bench of Chief Justice of India (CJI) DY Chandrachud and Justices JB Pardiwala and Manoj Misra set the order of the National Company Law Appellate Tribunal (NCLAT), which had upheld the transfer of ownership of the airline to Jalan Kalrock Consortium (JKC) as part of the Corporate Insolvency Resolution Process (CIRP), according to a report from Bar and Bench. 

The court directed the NCLT Mumbai Bench to appoint a liquidator immediately. It observed that since the resolution plan was no longer viable due to the successful resolution applicant’s failure to make the necessary payments, the option of liquidation was now the only course of action. 

The apex court said that NCLAT order was perverse as it misled evidence on record since the performance bank guarantee of Rs 150 crore could not have been adjusted against the payment of Rs 350 crore. 

The judgment marks a critical moment in the story of Jet Airways’ financial troubles, with the airline having been grounded since 2019. Its lenders, led by the State Bank of India (SBI), have long expressed concerns over the non-implementation of the resolution plan, which was supposed to bring the airline back into operation.  

The lenders had moved the apex court against a NCLAT order upholding the transfer of ownership of the airline to JKC, a consortium led by UAE-based entrepreneur Murari Lal Jalan and UK-based Kalrock Capital. 

Jet Airways was grounded in 2019 due to severe financial troubles. State Bank of India (SBI), its largest lender, initiated insolvency proceedings against the company before the NCLT in Mumbai, leading to the CIRP. In 2021, JKC emerged as the successful bidder for the airline's revival.