Budget airline SpiceJet told the Delhi high court on Tuesday that it faces a severe liquidity crunch and is unable to deposit ₹144.5 crore as directed in its ongoing arbitration dispute with Kalanithi Maran and KAL Airways Pvt. Ltd.
Almost 40% of SpiceJet’s flights to Gulf destinations have been cancelled due to the ongoing war, worsening its financial position, the carrier said in a submission made before a bench of Justice Subramonium Prasad.
SpiceJet had filed a fresh plea seeking relief from the direction to deposit ₹144 crore within six weeks to comply with its payment obligations to Maran and KAL Airways.
Even before the war in Iran, SpiceJet had a liquidity crunch because it suffered losses, senior counsel Amit Sibal submitted.
“We are not in financial distress—I’m not saying that. But we do have a liquidity issue,” Sibal said.
SpiceJet and its chairman Ajay Singh also sought modification of the court’s direction, proposing to furnish an immovable property worth about ₹148 crore as security instead of making an upfront cash deposit.
“We have unencumbered security and we have based the valuation on that of a registered valuer. I have the original title deeds with me. This was originally encumbered, but it was released to me, and therefore I have the original title deeds and can deposit them with the registry,” Sibal told the court.
The court is expected to continue hearing SpiceJet’s plea on Wednesday.
The fresh application was filed on 6 March after the Supreme Court on 27 February refused to stay the Delhi high court’s order directing the airline and its promoter Ajay Singh to deposit ₹144.51 crore. The apex court imposed a cost of ₹1 lakh on the airline for prolonging the litigation.
Admission of dues
The Supreme Court’s refusal meant SpiceJet was required to comply with the high court’s 19 January order within six weeks, which prompted the airline to file the fresh plea seeking to furnish property instead of cash.
In its 19 January order, the high court recorded that SpiceJet had admitted ₹194.51 crore was due and payable under earlier Supreme Court directions. After adjusting ₹50 crore already deposited, ₹144.51 crore remained outstanding.
The court noted that the Supreme Court had issued clear directions in February and July 2023 requiring compliance within timelines and held that those directions were not fully adhered to.
Email queries sent to SpiceJet seeking confirmation and response on the submissions made before the Delhi high court remained unanswered until publishing time.
SpiceJet shares have declined about 16% so far in 2026.
The dispute dates back to January 2015, when Kalanithi Maran and KAL Airways transferred their 58.46% stake in SpiceJet to Ajay Singh when the airline faced acute financial distress. As part of the arrangement, Maran and KAL Airways infused about ₹679 crore into the airline towards the issuance of convertible warrants and preference shares.
Maran later alleged that these instruments were not issued by the new management and sought a refund. The matter was referred to arbitration before a three-member tribunal comprising retired Supreme Court judges.
In July 2018, the tribunal rejected Maran’s ₹1,323 crore damages claim but directed SpiceJet to refund ₹579 crore, along with interest, related to the warrants and preference shares.
Both sides challenged aspects of the award before the Delhi high court, leading to a prolonged phase of enforcement proceedings, appeals and interim orders before the high court and the Supreme Court.
SpiceJet, however, maintains it has already paid about ₹730 crore to Maran and KAL Airways, including the principal amount of ₹579 crore and about ₹150 crore towards interest.
The dispute remains a significant legal and financial overhang for the airline, which has in recent years faced liquidity pressure, aircraft grounding due to unpaid dues, and insolvency petitions from lessors and creditors.
