SpiceJet, a leading Indian budget airline, is facing renewed financial troubles as several lessors and a former pilot have filed insolvency petitions against the airline in the National Company Law Tribunal (NCLT). Three Ireland-based aircraft lessors, NGF Alpha, NGF Genesis, and NGF Charlie, are seeking to initiate insolvency proceedings over outstanding payments of $12.68 million, claiming that SpiceJet has failed to pay them for leasing five Boeing 737s. The lessors also accuse the airline of removing aircraft parts, including engines, and using them in other planes.
The NCLT has scheduled a hearing for April 7, 2025, to settle the dispute. In a separate case, the NCLT is examining whether the insolvency plea filed by a former pilot is barred under Section 10A of the Insolvency and Bankruptcy Code (IBC). The section provides temporary relief to financial and operational creditors from initiating insolvency proceedings for defaults occurring between March 25, 2020, and March 24, 2021.
This is not the first time SpiceJet has faced financial difficulties. The airline has been battling multiple cases from lessors, vendors, and creditors in the NCLT and National Company Law Appellate Tribunal (NCLAT). In September 2024, SpiceJet raised $3,000 crore through a qualified institutional placement to clear dues owed to lessors, engineering vendors, and financiers. However, the airline’s financial troubles remain far from over, with fresh petitions piling up. The airline’s struggles highlight the challenges faced by low-cost carriers in India, particularly those that have expanded rapidly without adequate financial discipline.