The Delhi High Court, on February 14, has directed SpiceJet and Engine Lease Finance BV to propose agencies capable of assessing engines, amid their conflicting claims regarding the condition of a leased engine.
The engine, currently held by SpiceJet, is at the heart of a legal dispute between the two parties, with the lessor accusing the financially strained airline of non-payment.
The lessor contends that the engine is inoperative, while SpiceJet argues it is serviceable.
On February 12, the lessor requested SpiceJet to return the engine “as is where is” for inspection in Brussels. Subsequently, it intends to seek reimbursement for repair costs from SpiceJet. To mitigate further discord, the court recommended the appointment of an agency to certify the engine’s condition before transportation. The case is scheduled for further hearing next week, during which both parties are expected to propose agency names.
The dispute arose after the lessor examined the engine in January and alleged that SpiceJet’s maintenance practices were detrimental, rendering the engine unfit for return to Europe.
In December, Engine Lease Finance filed a petition alleging SpiceJet’s failure to fulfill payment obligations as per their agreement.
The lessor claims that despite an October agreement, SpiceJet has only partially fulfilled its payment commitments. The court stressed the importance of honoring agreements and directed SpiceJet to provide an undertaking regarding payment.
Previously, in October, the lessor and SpiceJet reached an interim settlement wherein the lessor agreed not to pursue a stay application against the airline.
Engine Lease Finance petitioned the court, stating the termination of its lease with SpiceJet and the return of eight out of nine engines as per the agreement. Consequently, SpiceJet is prohibited from using the engine post-termination, a restriction sought by the lessor through court intervention.
In addition to Engine Lease, at least two other lessors have approached the Delhi High Court alleging SpiceJet’s default in payment.
