Kalanithi Maran to seek over Rs 1,323 crore in damages from SpiceJet
KAL Airways and its promoter, Kalanithi Maran, announced on Monday their intent to seek more than Rs 1,323 crore in damages from SpiceJet and its chief, Ajay Singh, while also challenging a recent Delhi High Court order in their ongoing legal dispute, reported news agency PTI.
On May 17, a division bench of the Delhi High Court set aside a single judge’s order that had upheld an arbitral award requiring SpiceJet and Ajay Singh to refund Rs 579 crore plus interest to Maran. The bench allowed the appeals filed by Singh and SpiceJet, challenging the single judge’s order from July 31, 2023, and remanded the matter back to the lower court for reconsideration of the petitions challenging the arbitral award.
Following this development, Maran and KAL Airways have decided, after consulting with their legal counsel, to challenge the ruling. The decree holders believe the judgement is “deeply flawed and warrants further scrutiny.”
In addition to challenging the ruling, Maran and KAL Airways are seeking damages exceeding Rs 1,323 crore, as estimated by FTI Consulting LLP, a UK-based firm specialising in assessing losses from contractual breaches. This claim for damages had originally been presented before the arbitral tribunal and remains a critical component of their legal strategy.
A protracted legal battle
By pursuing both the challenge to the Delhi High Court judgement and the claim for damages, Maran and KAL Airways aim to achieve a just resolution to the protracted dispute, which they assert has caused significant hardship for over a decade. The statement added that they would also pursue the execution of the arbitral award, seeking a refund of pending dues amounting to Rs 353.50 crore.
This action aligns with the Supreme Court’s orders dated February 13, 2023, and July 7, 2023, directing that the award in favour of the decree holders be executed in its entirety.
Meanwhile, SpiceJet has responded to the Delhi High Court ruling by stating its intention to seek a refund of Rs 450 crore out of the total Rs 730 crore paid to Maran and KAL Airways.
SpiceJet’s dispute with Kalanithi Maran
The dispute traces back to early 2015, when Ajay Singh, who had previously owned SpiceJet, reacquired the airline from Maran after it was grounded due to financial difficulties. As part of the acquisition agreement, Maran and KAL Airways claimed to have paid SpiceJet Rs 679 crore for issuing warrants and preference shares. However, in 2017, Maran approached the Delhi High Court, alleging that SpiceJet had neither issued the convertible warrants and preference shares nor returned the money.
First Published: May 27 2024 | 3:03 PM IST