Here is why NCLT denies Jet Airways employees copy of resolution plan
The Mumbai bench of the National Company Law Tribunal (NCLT) has dismissed several petitions filed by Jet Airways employees seeking copies of the resolution plan.
Dismissing the Jet Airways employees petition, the Mumbai NCLT said that statutory mandate requires that the resolution plan can only be presented to the Committee of Creditors (CoC) for its approval and presented before the Adjudicating Authority for its satisfaction in approving the same.
“The Code or the regulations there under do not contemplate presentation or supply of the resolution plan or a copy thereof to any other body or entity,” says the order dated 22 February 2021.
The petitions were filed by National Aviators’ Guild (NAG), a Union representing the pilots of the Corporate Debtor on behalf of approximately 1045 pilots; the Maintenance Engineers of the Corporate Debtor under the umbrella of Jet Aircraft Maintenance Engineers’ Welfare Association (JAMEWA); Bhartiya Kamgar Sena (BKS) and Jet Airways Cabin Crew Association (JACCA) respectively representing 70% of the ground staff and the majority of the Cabin Crew of the Jet Airways; and All India Jet Airways Officers’ and Staff Association (AIJAOSA).
Jet Airways employees and their associations had argued in the NCLT that many employees of Jet Airways, which was grounded on 18 April 2019, continue to be in its rolls and that they are unaware of the resolution plan.
It was contented by one of the employee associations that they needed to know what was being provided for the employees in the resolution plan. They argued that the employees of the corporate debtor are its assets and are interested in its successful resolution. Any revival plan, for that matter, both in terms of employment and provision for outstanding wages / dues, is vital for their sustenance and mutual benefit, they submitted. They even made the appeal on the ground that some of the employees have lingered on the rolls of the Corporate Debtor despite the financial hardships and difficulty it entailed.
However, the resolution professional — Ashish Chhawchharia – argued in the tribunal that he was duty-bound to maintain and ensure the confidentiality of the resolution plan as provided under the Code.He argued that the Code being a special legislation does not provide for participation of the Applicants, who necessarily are the Operational Creditors of the Corporate Debtor, in the deliberations of the CoC.
He further contented: “The members of the CoC could only be made aware of the contents of the Resolution Plan which they are statutorily obliged to vote on. The Code doesn’t envisage sharing of the Resolution Plan with the Operational Creditors nor all the Creditors deserve to be heard during the process of the approval of Resolution Plan.”
The NCLT found merit in resolution professional’s argument and declined any relief to the petitioners (Jet Airways employees).
It also stated that the involvement of the employees who essentially are the operational creditors of the corporate debtor is limited to the satisfaction of their claims and personal entitlements.
The Committee of Creditors of Jet Airways has approved the resolution plan submitted by The consortium of Kalrock Capital and UAE-based entrepreneur Murari Lal Jain by 99.22% of votes on 17 October 2020.
Also Read: Who is Murari Lal Jalan, the NRI who is looking to acquire insolvent Jet Airways
