India’s SpiceJet to pay $1.5 million to Credit Suisse after court order

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By Aditi Shah and Arpan Chaturvedi

NEW DELHI (Reuters) – India’s SpiceJet said on Monday it would pay $1.5 million to Credit Suisse as demanded by the country’s top court.

Earlier in the day, India’s Supreme Court ordered SpiceJet to make the payment by Sept. 15 in a case related to unpaid dues, and warned the budget airline of unspecified “drastic action” at the next hearing if it failed to do so.

A third of the amount is part of a monthly settlement plan SpiceJet had previously agreed with Credit Suisse, and the rest are unpaid dues to the bank that have accrued since last year after the airline failed to keep up with the payment schedule.

If SpiceJet fails to pay, the Supreme Court will take “drastic action” at the next hearing on Sept. 22, it said.

“Enough of this dilly-dally business … We are not bothered even if you die,” one of the two judges said during the hearing, which was attended by SpiceJet chief Ajay Singh.

The airline had previously said the Credit Suisse debt was an old one that predated the tenure of its current management.

Credit Suisse and SpiceJet have been engaged in a legal dispute since 2015 over the bank’s claim of unpaid dues of around $24 million, which led to the Madras High Court’s order that the airline be wound up in 2021.

Even after agreeing a settlement plan, the dues were not paid, and in March Credit Suisse approached the Supreme Court seeking to initiate contempt proceedings against SpiceJet and Singh over “a wilful and intentional disobedience” of court orders and failure to pay dues of $4.5 million.

Contempt of court can attract a fine and/or imprisonment.

The court order is the latest setback for cash-strapped SpiceJet which told a court last month it was “struggling to stay afloat” after it was ordered to pay 1 billion rupees ($12 million) to its former owner, Kalanithi Maran, by Sept. 10 as part of an arbitration order in a separate case.

In that case, also heard on Monday at a Delhi High Court, SpiceJet said it had deposited 625 million rupees of that amount.

The airline said late on Monday it would complete the payment of 1 billion rupees to Maran by Tuesday.

($1 = 82.9963 Indian rupees)

(Reporting by Arpan Chaturvedi, Aditi Shah and Yagnoseni Das, additional reporting by Aditya Kalra; Editing by Himani Sarkar, Miral Fahmy and Mark Potter)