Delhi High Court: In a suit for declaration filed by TWC Aviation Capital (‘TWC’) against SpiceJet, the defendant, for enforcement of orders passed by the High Court of Justice in England Wales, Court (Business and Property Courts of England Wales King’s Bench Division Commercial Court) (‘UK Court’), Prathiba M. Singh, J., observed that UK Court was a competent Court in terms of the agreement between the parties, and directed SpiceJet to return aircrafts to TWC along with engines.
Background
The matter revolves around a dispute between TWC and SpiceJet over the lease of two Boeing aircrafts and their engines.
TWC is the owner of two Boeing aircrafts and several engines. These were leased to SpiceJet under an agreement, for a term of 12 months with a monthly rent of USD 180,000. Due to payment defaults by SpiceJet, exacerbated by the COVID-19 pandemic, various amendment agreements were made but were also breached.
TWC issued a notice to SpiceJet demanding certain undertakings, which were not complied with. Consequently, TWC filed a suit in the UK Court, in terms of the jurisdiction clause in the Agreement. The UK Court issued orders, restraining SpiceJet from using or disposing of the aircraft and engines and ordering them to assemble the technical and operational records for handover to TWC.
Further, in March 2024, the UK Court directed SpiceJet to deliver the aircraft and engines to TWC at specified locations in India. Despite these orders, SpiceJet failed to comply, leading TWC to seek enforcement of these orders in the Delhi High Court.
Decision and Analysis
The Court noted that a foreign order or judgment is only unenforceable if any conditions under Section 13 of the Civil Procedure Code, 1908, (‘CPC’) are met, and none of these conditions are applied in this case since the UK Court was the competent court as per the parties’ agreement.
The Court observed that the SpiceJet had fully participated in the proceedings, and there was no reason for the Court to deem the order unenforceable in India. The Court noted that given SpiceJet’s admitted dues, it was unjustifiable for them to continue using the aircraft and engines without payment.
The Court observed that in the current situation, there was no evidence to question the validity of the UK Court’s order or judgment, nor could it be claimed that TWC’s claims were frivolous or vexatious. The Court noted that it was undisputed that TWC owned the aircraft and engines, and SpiceJet had defaulted on payments and breached the lease agreement.
The Court observed that if the engines were not returned and serviced properly, it would cause irreparable harm to the Plaintiff and potentially damage the engines beyond repair, thus permanently affecting the Plaintiff’s ability to monetize them.
Given the substantial dues owed by SpiceJet to TWC and considering the balance of convenience and potential irreparable harm to TWC, the Court opined that the aircraft and engines should be secured. The Court had previously directed an inspection of the aircraft frames and sought SpiceJet’s proposal on payment.
Despite SpiceJet’s offer to pay USD 500,000 per week, the Court found this insufficient against the total dues of over USD 10 million. The Court, thus, directed SpiceJet to hand over the aircraft, engines, and all relevant records to TWC by 28-05-2024.
The matter is next listed on 31-05-2024.
[TWC Aviation Capital Ltd. v. SpiceJet Ltd., 2024 SCC OnLine Del 3663, Decided on 15-05-2024]
Advocates who appeared in this case :
Advocates for the Plaintiff: Ashish Dholakia, Sr. Adv.; Ravi Nath, Ankur Mahindro, Rohan Taneja, Aditya Kapur, Vishali, Ankesh Tripathi, Yashika Arora, Abhijeet Mittal, Siddhant Vyas, Ankush Satija, Mohit Dagar, Rohit Bishnoi, Shubhangi Jain
Advocates for the Defendant: Sandeep Sethi, Sr Adv, K. R Sasiprabhu, Kartikeya
Asthana, Shreya Sethi
