- The Supreme Court dismissed SpiceJet's plea against a Rs 144.5 crore deposit order by Delhi High Court
- Ajay Singh was fined Rs 1 lakh for pursuing prolonged litigation in the arbitration dispute
- The dispute arose from a 2015 share sale deal where Kalanithi Maran sold SpiceJet shares to Ajay Singh
The Supreme Court has dismissed a plea filed by SpiceJet Ltd and its chairman Ajay Singh challenging a January 19 order of the Delhi High Court directing the airline to deposit Rs 144.5 crore in its protracted arbitration dispute with Kalanithi Maran and KAL Airways Pvt Ltd.
A bench of Justices PS Narasimha and Alok Aradhe declined to interfere with the High Court's direction and imposed a fine of Rs 1 lakh on Ajay Singh, observing that the litigation had been pursued repeatedly over the years.
The case stems from a 2015 transaction when SpiceJet was facing acute financial distress and risked suspension of operations.
The 2015 Rescue Deal and Fallout
In January 2015, under a Share Sale and Purchase Agreement (SSPA), Kalanithi Maran and KAL Airways - then promoters holding a 58.46% stake in SpiceJet - agreed to transfer their entire shareholding to Ajay Singh for a nominal Rs 2.
The deal was accompanied by a broader financial arrangement involving issuance of warrants and cumulative redeemable preference shares (CRPS), along with an overall funding commitment of approximately Rs 450 crore.
Subsequently, disputes arose over alleged non-performance of reciprocal obligations under the SSPA, triggering arbitration proceedings.
In July 2018, a three-member arbitral tribunal directed SpiceJet and Ajay Singh to refund Rs 308.21 crore to Maran and KAL Airways, along with 12% annual interest from November 2015. Both sides challenged the award under Section 34 of the Arbitration and Conciliation Act, 1996, even as enforcement proceedings continued.
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Multiple Rounds of Litigation
The enforcement proceedings have seen repeated hearings before the Delhi High Court and the Supreme Court.
Earlier interim directions required a deposit of Rs 579 crore, later modified to a Rs 329 crore bank guarantee and Rs 250 crore cash deposit. In 2019, Rs 250 crore was released to the decree holders, with Rs 58.21 crore paid through encashment of the bank guarantee.
In February 2023, the Supreme Court ordered encashment of the remaining bank guarantee and directed payment of Rs 75 crore towards interest within three months, warning that non-compliance would make the award executable in full. In July 2023, the Court refused to grant further time, holding that the award had become executable due to non-compliance.
In January 2026, the Delhi High Court considered fresh applications by SpiceJet and Ajay Singh seeking a stay of the award. The Court noted that prior Supreme Court directions had not been complied with and invoked Article 144 of the Constitution, which mandates that all authorities act in aid of the Supreme Court.
It also recorded that the judgment debtors had admitted that Rs 194.51 crore remained payable toward interest, of which Rs 50 crore had been deposited.
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