NCLT Rejects Jet Airways Workers Unions' Plea Seeking Copy of Resolution Plan

NCLT Rejects Jet Airways Workers Unions' Plea Seeking Copy of Resolution Plan

The National Company Law Tribunal (NCLT) has rejected applications filed by Jet Airways (India) Ltd.'s workers unions wherein it sought a copy of the resolution plan submitted by a consortium led by Dubai-based entrepreneur Murari Lal Jalan and Kalrock Capital.

The NCLT bench consisting of Janab Mohammed Ajmal and V Nallasenapathy heard the plea through video conferencing. It observed that a resolution plan can only be presented to the committee of creditors (CoC) or the adjudicating authority for its approval. The Tribunal dismissed the plea and added that the Insolvency Code doesn't anticipate sharing of the plan with any other entity.

The NCLT passed the said order on receiving a plea from three unions namely the National Aviators' Guild, representing more than 1,000 pilots, Jet Aircraft Maintenance Engineers Welfare Association and the Jet Airways Cabin Crew Association, and the Jet Airways Cabin Crew Association.

These Unions approached the Tribunal together for seeking a stay on any final order until their plea was decided by the Tribunal. They requested the NCLT to give directions to the resolution professional to share the full copy of the resolution plan, along with valuation and other reports prepared by Alvarez and Marsal.

They further sought approval to participate in the proceedings before the Tribunal. They contended before the Tribunal that the employees of the airlines were interested in its resolution and remained on the payroll despite financial hardships.

They contended that the employees of Jet Airways are its assets and are interested in its successful resolution. The Union being unaware of the details of the Resolution Plan needed to know what was provided thereunder for its members and employees.

Jet Airways was the largest national carrier by market value in India. A consortium of 26 lenders led by the State Bank of India (SBI) had initiated insolvency proceedings against it as it defaulted on its loan obligations.

Gaurav Joshi, the senior advocate representing the resolution professional, argued that the Insolvency Code requires the resolution professional to ensure confidentiality of a plan. He further stated that the Code does not provide that all creditors deserve to be heard during its approval.

He argued that the applications filed before the Tribunal is an attempt to derail the insolvency resolution process of the company.

The NCLT rejected the plea and it stated in its' written order that, "Jet Airways is duty-bound to maintain and ensure confidentiality of the resolution plan as provided under the Insolvency and Bankruptcy Board of India."