Volume 2 Issue 7

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Madras High Court Supports the Winding up Petition Filed by Credit Suisse over Default in Payment by Spice Jet.

Date of News: 

11-01-2022

Date of Publication: 

10-02-2022

Unique ID:

202281505

Name of the Author: 

Sonam Awasthy

Field of Law: 

Air and Space Law

Content of News:

A division bench of Madras High Court approved the winding up petition filed by Credit Suisse against Spice Jet over defaulting on payment of $24 million with respect to engine maintenance service. However, the court extended the airline stay order till 28th January to move to Supreme Court for the further appeal. In 2015, Credit Suisse approached the madras high court as spice jet didn�t response to notice regarding the debt as required under companies act, 1956. On December 6, justice R. Subramaniam had ordered the winding up of airline under section 433(e) of companies act, 1956 and further appointed the liquidator to handle the finance. The Ajay Singh promoted company challenged the order before a division of bench. But, the bench dismissed the appeal by stating that there will no interference required under the impugned orders. Proceedings before the high court raised out an old agreement of November 2011, where Swiss firm raised invoice and the airline issued seven bill of exchange for the monies due under the invoice. An agreement of 2012 was also dragged where SR Technics entered into finance agreement was taken place between the Credit Suisse. The spice jet argued that the documents relied by Credit Suisse are not stamped and they don�t have any valid license from director general of civil aviation. The high court admonished over the defence of company by stating that the appellant carried thousands of passengers all these years without maintenance of its aircrafts and engine from any service provider without valid license from director general of civil aviation.

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