India’s Supreme Court Dismisses Kalanithi Maran’s Appeal in SpiceJet Dispute

India’s Supreme Court has ruled against Kalanithi Maran and his investment vehicle, KAL Airways, in their long-standing legal dispute with SpiceJet (SG, Delhi International). The court declined to accept an appeal against a Delhi High Court decision that had previously set aside an arbitral award favoring Maran and KAL Airways. This development marks a significant legal victory for SpiceJet.

The dispute dates back to the 2015 transfer of ownership in SpiceJet from Maran to Ajay Singh, the current majority shareholder and promoter. The original legal contention involved a substantial arbitral award of INR 5.79 billion rupees (USD 69.2 million) directed to Maran and KAL, which was upheld by a single judge of the Delhi High Court in July 2023.

However, this decision was later challenged by Singh and SpiceJet, citing insufficient reasoning and lack of adequate judicial application, leading to the two-judge bench of the High Court overturning the initial ruling in May 2024. The division bench argued that the earlier ruling lacked “adequate reasoning” and demonstrated no proper judicial examination of the arguments presented, necessitating a remand for a new hearing.

Chief Justice DY Chandrachud, in the latest hearing on July 26, criticized the 2023 ruling’s quality, stating, “This is atrocious, this is not the way to write an order under s.34, this is really atrocious.” He emphasized the lack of discernible reasoning in the initial decision, affirming the division bench’s decision to send the matter back for reevaluation.

SpiceJet has welcomed the Supreme Court’s dismissal, viewing it as a confirmation of their legal stance and a significant end to the contentious chapter. “The Supreme Court’s dismissal of Maran’s appeal vindicates SpiceJet’s position in this protracted legal battle,” a SpiceJet statement noted. The airline also announced plans to pursue a refund of INR 4.5 billion (USD 53.7 million) following this judgment.

This refund, coupled with ongoing efforts to raise new funds, is expected to bolster SpiceJet’s financial stability and support its expansion strategies.

The matter is now set to return to the Delhi High Court for a fresh hearing before a different judge, with the date yet to be determined, potentially extending the legal proceedings but with SpiceJet currently holding the advantageous position.

Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com