The National Company Law Tribunal has dismissed the liquidator’s attempt to recover Rs 500 crore from Boeing. The tribunal ruled that the dispute over pre-delivery payments requires a full civil trial, as it falls outside the scope of insolvency proceedings. This decision keeps the funds out of the asset pool available for distribution to creditors in the ongoing liquidation of the grounded airline.
The National Company Law Tribunal (NCLT) in Mumbai has rejected a petition filed by the liquidator of Jet Airways, which sought to recover approximately Rs 500 crore from the aerospace major Boeing. The liquidator had aimed to bring these funds back into the liquidation estate, arguing they should be available for distribution to the airline’s creditors.
This dispute dates back to 2013, when Jet Airways had paid roughly USD 92.13 million as advance payments for two aircraft. Following financial issues at the airline, Boeing suspended the agreements in 2019, shortly before the airline entered insolvency. Boeing had maintained that it had already offset these advance payments against its own claims, which were filed with the Resolution Professional during the insolvency process.
The tribunal, led by the bench of Prabhat Kumar and Sushil Mahadeorao Kochey, determined that the matter could not be resolved under the summary jurisdiction of the Insolvency and Bankruptcy Code (IBC). Under Section 60(5) of the IBC, the NCLT’s authority is generally limited to matters directly related to the insolvency process. The bench concluded that this specific disagreement over contractual terms and evidence is complex and would require a full-fledged trial in a competent civil court to be settled.
For the liquidation process, this ruling is a setback as it effectively closes a potential avenue to increase the pool of assets available for creditors. Jet Airways has been in a terminal state of liquidation since the Supreme Court ordered the process to begin in November 2024. The tribunal also noted that the inability to review the relevant agreements due to confidentiality concerns further highlighted why this case could not be settled within the NCLT’s current framework.
Investors and stakeholders following the liquidation process may now monitor if the liquidator decides to pursue this recovery through a separate civil litigation. However, such a path typically involves significant time and legal costs, and there is no guarantee of a favorable outcome for the creditors. The primary monitorable remains the overall timeline and the value of the assets that can be successfully recovered and distributed among the various claimants during the final liquidation phase.