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Budget carrier SpiceJet announced its intention to seek a refund of INR 450 crore out of the total amount of INR 730 crore it had earlier paid to former promoter Kalanithi Maran and his company, KAL Airways. This decision comes after the Delhi High Court’s verdict on May 17.
The Division Bench of the Delhi High Court on May 17 ruled in favor of SpiceJet and its promoter, Ajay Singh. The ruling related to a long-standing share transfer case involving former promoter Kalanithi Maran and his firm KAL Airways. As a result of this ruling, an earlier decision by a single judge has been annulled. This positions SpiceJet to potentially claim a significant refund, following legal advice.
SpiceJet has paid a total of INR 730 crore. This amount includes INR 580 crore as principal amount and an additional INR 150 crore for interest paid to Maran and KAL Airways. After quashing the impugned order, SpiceJet is expected to receive a refund of INR 450 crore.
SpiceJet and Ajay Singh’s appeal raised several important issues regarding reimbursement and justification of interest in the case. The Division Bench recognized the significant merit of these challenges and noted that they had not been adequately addressed in the previous order dated July 31, 2023. The Division Bench in its judgment stated that the single judge had erred in dismissing the section. 34 petitions filed by Ajay Singh and SpiceJet without properly investigating the claims of patent illegality and the refund order against SpiceJet even though there were admitted infringements by KAL Airways and Kalanithi Maran.
The Court also noted that criminal interest was charged even though SpiceJet did not breach the share purchase agreement. Since these facts were not taken into consideration by the single judge, the appeals of Ajay Singh and SpiceJet were allowed and the judgment of July 31, 2023 was set aside.
