A division bench of the Delhi High Court on Friday overturned a single-judge's order that had directed SpiceJet Ltd. to refund over Rs 270 crore to Sun Group Promoter Kalanithi Maran.
This dispute originates from a 2015 agreement between Maran and SpiceJet's Promoter Ajay Singh. Under this agreement, Maran—associated with Sun Network and Kal Airways—transferred 58.46% stake in SpiceJet to Singh.
The arrangement included provisions for Maran and Kal Airways to receive warrants and preference shares, which were never issued. In 2018, an arbitral tribunal ruled in favour of Maran, awarding him Rs 579 crore along with interest. The tribunal dismissed Maran's claim for Rs 1,323 crore in damages for the non-issuance of warrants, but mandated a refund of Rs 579 crore plus interest.
SpiceJet was allowed to provide a bank guarantee of Rs 329 crore and deposit Rs 250 crore in cash. Specifically, SpiceJet had to pay Rs 308 crore in cash, with 12% interest for 30 months. It also has to either issue Rs 270 crore in compulsory redeemable preference shares, or refund the money as per the Share Purchase Agreement. If SpiceJet failed to comply, Maran would be entitled to 18% interest.
On July 31, 2023, a single judge of the Delhi High Court upheld the arbitration tribunal's award from July 20, 2018, in favour of Maran and Kal Airways. The single judge's decision was appealed, and the case was brought before a division bench of Justices Yashwant Varma and Dharmesh Sharma in September 2023.
The division bench has sent the matter for reconsideration by the single-judge bench.
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