HC orders SpiceJet to return leased engine

HC orders SpiceJet to return leased engine

Observing that SpiceJet Ltd must strictly adhere to the deadline, the Delhi High Court on Thursday asked the low-cost airline to return leased engine to Engine Lease Finance BV, in Brussels, Belgium, at its own expense by March 10.

It also asked Spicejet chairman and managing director Ajay Singh to file an affidavit within a week undertaking that the engine will be delivered on time without any further delay.

The HC cautioned SpiceJet to take the deadline seriously while the lessor sought to initiate contempt proceedings against Singh if the engine was not returned as per the scheduled date.

The carrier said it was ready to return the engine at its own expense through transport cargo before the deadline ends, but it was waiting for various clearances, including customs for the delivery.

Both Spicejet and Engine Lease Finance agreed to get the inspection of the engine done by their own agencies by February 26.

The HC has last week asked the both parties to name a neutral third party agency to certify the present condition of the engine leased to the airline so that they can be returned to the engine lessor on “as is where is basis”. However, both could decide on any common agency.

On January 24, Engine Lease Finance told the HC that the engine it had leased to the airline was currently in an unserviceable condition and not capable of being delivered back. However, SpiceJet had said the engine’s condition had deteriorated due to wear and tear.

The lessor had moved the HC seeking direction to the airline to return the engine after the latter had failed to make payments of over $2 million in terms of an interim settlement.

In the settlement, SpiceJet had also agreed to return the last of the nine engines that the low-cost carrier had acquired from Engine Lease Finance as the contract between them had been terminated.

The lessor had asked the HC to hold SpiceJet responsible for covering the costs of returning the engine and restoring it to a usable state. It further claimed that the engine was currently unfit for service and cannot be returned to Europe citing the airline’s negligence in maintaining it.

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