The Supreme Court on Thursday ordered the liquidation of Jet Airways, ending hopes of reviving the once-prominent airline. In a significant move, the court invoked its “extraordinary” powers under Article 142 of the Constitution to overturn a previous tribunal decision. This decision had allowed ownership of Jet Airways to be transferred to the Jalan-Kalrock Consortium under a resolution plan, which the court found had not fully addressed creditor payments.
Article 142 grants the Supreme Court the authority to issue orders for “complete justice” in pending cases. In Jet Airways’ case, the court noted that the circumstances were “peculiar and alarming,” referencing the incomplete implementation of the resolution plan. The court determined that these issues left it with no alternative but to place Jet Airways into liquidation, bringing an end to efforts to restore the airline’s operations.
Chief Justice DY Chandrachud, along with Justices JB Pardiwala and Manoj Misra, emphasized that liquidation should be considered only as a last resort for lenders. The court noted that, given the significant problems in executing the resolution plan, a feasible revival of Jet Airways was no longer possible. As a result, the court decided in favor of a petition from creditors, including major banks like the State Bank of India and Punjab National Bank.
The decision follows ongoing concerns raised by creditors regarding the resolution plan’s inadequacies and the inability to fulfill payment obligations. The Jalan-Kalrock Consortium’s bid to revive Jet Airways faced scrutiny over delays in payment to creditors, ultimately prompting the lenders to appeal for liquidation. The Supreme Court’s judgment underscores the importance of fully honoring creditor claims in the resolution process.
With Jet Airways now set for liquidation, its assets will be processed to recover dues for creditors. This decision marks the conclusion of a protracted insolvency process for the airline, once one of India’s leading carriers. The Supreme Court’s intervention highlights the critical role of judicial oversight in resolving complex corporate insolvency cases, ensuring that the interests of creditors are upheld.
