Delhi HC permits lessor to examine engines that SpiceJet has leased

Delhi HC permits lessor to examine engines that SpiceJet has leased

Delhi HC permits lessor to examine engines that SpiceJet has leased

Once when the engine is grounded and once when it is delivered again, inspections must be performed. The court ordered SpiceJet to keep the engines running as they are grounded, with the exception of engine replacement and other needs.

On January 16, the Delhi High Court granted Engine Lease Finance BV, the leasing business of SpiceJet, permission to examine the engine that the low-cost carrier had leased from them.

The engine must be inspected once when it is grounded and once again when it is delivered. The court ordered SpiceJet to preserve the status quo regarding its engines after they are grounded, with the exception of certain uses, such engine replacement.

The directive was issued in response to the lessor's accusation that SpiceJet was "cannibalizing" its engine components. The lessor also informed the court that despite the low-cost carrier shutting down the engine on January 15, it was still in use. The airline's attorneys supported their allegation with data from flightradar24, an app that monitors flights.

SpiceJet, however, informed the court that it was unsure about the integrity of the information the lessor had submitted. The airline, represented by senior attorney Sandeep Sethi, informed the court that it will turn down the engines by today and provide a response to all of the claims made by the lessor. It is now anticipated that this case's hearing will take place during the last week of January.

Senior advocates Rajasekhar Rao and Anand Venkataramani, briefed by Tuli & Co. with partner Saket Satpathy, represented Engine Lease Finance Corporation.

In December, Engine Lease Finance BV filed a lawsuit, claiming that the budget carrier had not fulfilled its end of the bargain.

The lessor had claimed that SpiceJet had only made partial payments and still owed the remaining balance from the October agreement. The airline cannot retract its statements, the court said, and SpiceJet was ordered to provide an affidavit in order to make the payment.

SpiceJet and the lessor came to an interim arrangement in October. The engine lessor agreed to refrain from suing the airline for a stay.

By January, SpiceJet would be required to pay over $2 million in engine leasing debt as per the terms of the deal. The dispute began when SpiceJet promised to return one engine by January 25. The engine lessor may go to court if SpiceJet fails to fulfill these obligations.

Eight of the nine engines were returned by SpiceJet, and the firm terminated its contract with the airline on September 27, as reported to the court by Engine contract Finance. The airline cannot use the engines once the lease ends in accordance with the agreement. In order for SpiceJet to cease utilizing its engines, the lessor requested a court injunction.