The National Company Law Tribunal (NCLT) has issued a notice to SpiceJet on the insolvency petition filed by its lessor, Wilmington Trust SP Services (Dublin), seeking a response from the airline. The lessor had initiated insolvency proceedings against the carrier for failing to pay dues worth over $16 million.
The NCLT has scheduled the hearing of the case for June 2, 2023. Meanwhile, SpiceJet is expected to file its response to the insolvency petition before the hearing.
This is not the first time that SpiceJet has faced insolvency proceedings. Earlier this year, another lessor, CDB Aviation, had initiated insolvency proceedings against the airline over unpaid dues. However, SpiceJet managed to avert insolvency by settling the dues with CDB Aviation.
SpiceJet has been struggling financially due to the impact of the pandemic on the aviation industry. The carrier had reported a loss of Rs 413 crore in the third quarter of the financial year 2022, compared to a profit of Rs 78 crore in the same period the previous year. However, the airline had stated that it expects to turn profitable in the fourth quarter of the financial year.
SpiceJet has been taking steps to improve its financial position, including cost-cutting measures and restructuring of its operations. The airline had also announced plans to raise funds by issuing securities worth up to Rs 2,500 crore.
The insolvency proceedings initiated by Wilmington Trust SP Services (Dublin) come as a setback for SpiceJet, which is already facing financial challenges. The outcome of the case will determine the future course of action for the airline, which has been struggling to stay afloat in the highly competitive Indian aviation market.
In conclusion, the insolvency petition against SpiceJet by Wilmington Trust SP Services (Dublin) is another setback for the airline, which is already facing financial challenges. The outcome of the case will be closely watched by industry experts and investors as it will determine the future course of action for the carrier in the highly competitive Indian aviation market.
