“We had demanded the return of application money paid towards the issue of warrants and preference shares. Since neither were allotted by Spicejet and since the refunds, too, were not forthcoming we had to resort to legal remedies. Our (latter) plea has been accepted by the panel of arbitrators and these amounts have been ordered to be repaid in full, with accumulated interest," said S L Narayanan, chief financial officer of Maran’s Sun Group.
Adding: "Our fundamental ground is on the doctrine of restitution which ought to apply in this case, since SpiceJet attributed its inability to honour contractual commitments due to impossibility of performance. Therefore, as a natural corollary, we believe the erstwhile promoters ought to be restored to their earlier position with respect to the share transfer transaction."
Maran sold his 58.46 per cent stake in SpiceJet to Ajay Singh for a nominal Rs 2 in 2015, after a financial crunch crippled its operation. Maran accused SpiceJet of breach of agreement, for not issuing him 189 million share warrants and preference shares, despite his Rs 6.79 billion infusion.
The warrants, SpiceJet contended, could not be issued as it did not get the BSE exchange’s approval. The tribunal held Maran was entitled to refund of Rs 5.79 billion. Maran had actually sought Rs 13.23 billion, arguing loss due to non-issue of the warrants. The tribunal did not accept this, as it had decided SpiceJet did not violate the agreement.
It has also asked both sides to see if preference shares could be issued to Maran, subject to him fulfilling certain terms of the agreement. Maran will be entitled to refund of an additional Rs 2.7 billion if there is no agreement on issue of preference shares. The refund amount is lower as the tribunal allowed a counter-claim by the airline.