SpiceJet faces new insolvency case filed by software solutions startup Techjockey

New Delhi: Software solutions startup Techjockey Infotech Pvt. Ltd. has filed an insolvency case against cash-strapped airline SpiceJet for an alleged default of around ₹1.18 crore.

The National Company Law Tribunal (NCLT) admitted the case for consideration and issued a notice to SpiceJet. The case is scheduled to be heard in November.

The insolvency plea, filed under Section 9 of the Insolvency and Bankruptcy Code (IBC), aims to initiate insolvency proceedings against the airline for default that stems from a 2021 agreement wherein SpiceJet acquired cloud services.

According to Techjockey's counsel, the company sent several invoices and raised demands for payment, to which SpiceJet did not respond, prompting the filing of the insolvency petition.

This case adds to a list of insolvency cases against SpiceJet for unpaid dues to various vendors and aircraft lessors. However, none of these pleas have resulted in insolvency proceedings against the airline to date. Some have been dismissed by the NCLT, while others have been withdrawn after settlements, with some still pending final decisions.

The parties filing various insolvency cases include Wilmington Trust SP Services (Dublin), Willis Lease Finance, Celestial Aviation, Aircastle, and Alterna Aircraft. Three entities—AWAS 36698 Ireland, AWAS 36694 Ireland, and AWAS 36695—along with Shannon Engine Support Limited and Engine Lease Finance B.V., and Raymach Technologies Pvt., have also filed cases.

The NCLT rejected the pleas of Willis Lease Finance and Wilmington Trust SP, while SpiceJet settled with Celestial Aviation, Alterna Aircraft, and Raymach Technologies Pvt., all of which have withdrawn their cases against the airline. 

The pleas from Aircastle, AWAS 36698 Ireland, AWAS 36694 Ireland, and AWAS 36695 remain pending, as do those from Shannon Engine Support Limited and Engine Lease Finance B.V.

Wilmington Trust and Willis Lease Finance have moved the National Company Law Appellate Tribunal (NCLAT) to challenge the NCLT's dismissal of their insolvency pleas.

Spicejet's QIP plans

SpiceJet on Monday said it had raised ₹3,000 crore through a qualified institutional placement (QIP), which opened on 16 September and closed on 18 September. The airline reported an overwhelming response from qualified investors, significantly oversubscribing the offering, reflecting strong confidence in the company’s growth prospects.

SpiceJet claimed that the diverse pool of top-tier institutional investors and mutual funds reaffirmed the market's belief in SpiceJet’s ability to navigate industry challenges and capitalize on growing demand in the aviation sector. 

Prominent global investors include Goldman Sachs (Singapore), Morgan Stanley Asia, BNP Paribas Financial Markets ODI, Nomura Singapore Limited ODI, Tata Mutual Fund, Discovery Global Opportunity Ltd, Société Générale ODI, Authum Investment and Infrastructure Limited, Bandhan Infrastructure Fund, White Oak, Carnelian Bharat Amrikaal Fund, 360 ONE Equal Opportunity Fund, and The Jupiter Global Fund.

Also Read: SpiceJet’s path to recovery: A tough, long climb to reclaim market share

According to the airline, in addition to the ₹3,000 crore raised through its QIP, SpiceJet will also receive an additional ₹736 crore from a previous funding round, further boosting its financial stability and growth plans.

“The strong response from investors and institutions is a testament to their faith in SpiceJet’s potential to rapidly scale and become a formidable player in India’s burgeoning aviation market. This fundraise marks a pivotal moment for SpiceJet as we look to scale new heights in the aviation industry," said Ajay Singh, chairman and managing director of the airline.

This fresh capital raised by SpiceJet will be crucial in helping the airline overcome its financial woes and settle with various creditors, primarily the lessors involved in ongoing litigations in the NCLT, Delhi High Court, and the Supreme Court regarding unpaid dues. Recent court orders have mandated the grounding of leased engines and aircraft in return for these unpaid dues, mounting troubles for the airline.

Last Friday, the Supreme Court rejected SpiceJet's plea against a Delhi high court order requiring the airline to ground three engines leased from Team France 01 SAS and Sunbird France 02 SAS over unpaid dues, compelling the airline to ground these engines.

According to media reports, SpiceJet CMD Ajay Singh claimed that the airline aims to increase its fleet to 100 aircraft by 2026. Singh indicated that SpiceJet plans to quickly return its 36 grounded aircraft to service due to a lack of spare parts.

By March 2025, the airline expects to have a fleet of 40 aircraft, equivalent to what Akasa Air will have, with plans to add another 40 thereafter.

SpiceJet's share price surged 10% on Monday, hitting an intraday high of ₹72.8 per share on the BSE after the news of the QIP.

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