SpiceJet loses appeal, faces deadline to return leased planes and engines

The Delhi High Court has upheld an earlier order directing SpiceJet to return two Boeing 737-8K9 aircraft and three engines to TWC Aviation Capital Limited. The airline had been using the leased assets without adhering to the lease agreement terms, leading to a significant debt of over $14 million to TWC.

The court, presided over by Justice Rajiv Shakdher, refused to grant SpiceJet a stay on the order, which originally mandated the return of the aircraft and engines by May 28. However, the airline was granted an extension until June 17 to comply with the order.

SpiceJet had argued that the UK court order was not enforceable in India as per Section 13 of the Code of Civil Procedure. However, the single-judge bench held that none of the conditions under Section 13 applied, as the UK court was the competent court in terms of the agreement between the parties. The bench also noted that SpiceJet had fully participated in the proceedings and that there was no reason to doubt the validity of the UK court’s order or judgment.

The court emphasized that SpiceJet did not possess the right to utilize the aircraft and engine without fulfilling the necessary lease payments. “The lessor is not in the business of charity,” the court stated. SpiceJet had also dismantled parts from the aircraft and engines, using them in other aircraft they owned, which was not permissible under the contract.

The airline had requested a one-week extension to return the aircraft and engine, but the court demanded they withdraw their appeal if they desired this concession. SpiceJet subsequently decided to abandon their appeal and the court granted them the extended deadline.

The court’s decision is seen as a significant victory for TWC Aviation, which had moved the single-judge bench seeking the enforcement of the UK court orders directing SpiceJet to return the aircraft and engines. The airline’s failure to comply with the directives had led to legal notices from TWC, and the court’s order aims to ensure that SpiceJet adheres to the lease agreement terms.

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