Team France 01 S A S v. Spicejet Limited

33 AND + CS(COMM) 909/2023 & I.As.25664-65/2023 SUNBIRD FRANCE 02 S A S..... Plaintiff Through: Mr Rajshekhar Rao, Sr Adv. with Mr Anandh Venkataramani, Mr Saket Satapathy, Mr Anubha Dutta, Ms Mansi Tyagi, Ms Akshita Totla, Ms Vishakha Gupta, Mr J Shivam Kumar and Mr Rishit Vimadalal, Advocates (M: 9079025647).

VERSUS

SPICEJET LIMITED..... Defendant Through: Mr. Sandeep Sethi, Sr. Advocate with Mr. K.R. Sasiprabhu, Mr. Kartikeya Asthana and Ms. Sherya Sethi, Advocates (M: 8851382791). CORAM: JUSTICE PRATHIBA M. SINGH Prathiba M. Singh, J. (Oral)

1. This hearing has been done through hybrid mode.

2. These are two connected matters filed by the Plaintiffs- Team France 01 S.A.S and Sunbird France 02 S.A.S against the Defendant-Spicejet Ltd. with respect to the two lease agreements dated 14th December, 2018 and 29th March, 2018 with respect to aircraft engines. Aggrieved by the default in payment obligations, the Plaintiffs’ seek specific performance of the Defendant’s contractual obligations to hand over possession of these engines, which are being held following the termination of the lease agreements.

3. Vide order dated 29th January, 2024, the Court directed the Defendant to make a payment of 4 million USD by 15th February, 2024 to the Plaintiff and further negotiations were to be held in respect of the past outstanding amounts of more than 20 million dollars. Meanwhile, monthly payments for the use of three aircrafts were also to be concurrently made. Further, on 1st may, 2024, the Court observed that the past dues and current dues, range to

10.84 million dollars i.e., Rs. 90 crores. The Court granted the Defendants some time for depositing Rs. 50 crores. However, it has been observed vide order dated 3rd May, 2024 that certain negotiations have taken place. The Court then directed that a sum of 1.58 million USD be paid by the Defendant to the Plaintiff by 22nd May, 2024.

4. Thereafter, the proposals which were handed over by the Plaintiff have been considered by the Defendant. There is some objection to the text of the proposals. Accordingly, the Court broadly records the terms on which the parties have agreed as an interim arrangement. The said terms are set out below:i) The Plaintiff is willing to accept a payment of US$ 4.[8] million as an interim arrangement amount to allow the Defendant to continue to use the three engines. This is acceptable to the Defendant, who has agreed to pay the same in four separate instalments of US$ 1.[2] million as per the following payment schedule:a) USD 1.[2] M (Rs.9,96,70,500) by 30th June, 2024 b) USD 1.[2] M (Rs.9,96,70,500) by 31st July, 2024 c) USD 1.[2] M (Rs.9,96,70,500) by 31st August, 2024 d) USD 1.[2] M (Rs.9,96,70,500) by 30th September, 2024 ii) In addition, the Defendant has also agreed to start making weekly payments of US $160,000 per week, which would include both the basic rent and maintenance accrual (usage charges) commencing from 8th June, 2024 on a weekly basis till 30th September, 2024. iii) If any of the payments set out above is missed by the Defendant, the Defendant would be liable to ground the three engines and return them within fifteen calendar days without the specific Court order to this effect, so long as there is no order to the contrary. iv) The payments in terms of Clause 1 and Clause 2 are mutually exclusive to each other. v) In the event that the Engine ESN 854096 becomes unserviceable, the Defendant would be required to immediately return the said Engine to the Plaintiff without any delay. vi) If the said engine is returned, the proportionate adjustment in the weekly payments shall accordingly be given to the Defendant.

5. According to the Plaintiff, after the above payments are made, there would be outstanding US$ 3,633,255.09, which as per the Defendant would be subject to reconciliation. Parties shall discuss the payment plan in respect of the outstanding rent subject to reconciliation.

6. The above interim arrangements shall continue to operate till September, 2024 subject to compliance of which, the Defendant is free to continue using the Aircraft and engines.

7. List on 8th August, 2024.

PRATHIBA M. SINGH JUDGE MAY 29, 2024 mr/ks