Delhi High Court Rejects ₹1,300 Crore Damages Claim by Kalanithi Maran Against SpiceJet
| 2025-05-26
SpiceJet’s share price rose over 4% after the Delhi High Court dismissed a ₹1,300 crore damages appeal by Kalanithi Maran and KAL Airways.
Delhi High Court dismisses ₹1,300 crore damages appeal by Kalanithi Maran and KAL Airways against SpiceJet, ending a long-running legal dispute over a failed share transfer deal.
In a ruling dated 23 May 2025, a Division Bench of the Delhi High Court rejected the appeal brought by Kalanithi Maran, chairman of the Sun Group, and his investment vehicle KAL Airways against SpiceJet. The appeal was the latest effort by Maran and KAL Airways to claim compensation from the budget airline in a legal battle that has spanned more than a decade.
SpiceJet disclosed the outcome in a regulatory filing with the Bombay Stock Exchange (BSE), stating: “We would like to inform you that the Division Bench of Delhi High Court in its order dated May 23, 2025, has dismissed the appeal filed by KAL Airways and Kalanithi Maran seeking damages of more than ₹1,300 crore and other claims.”
The claims had previously been rejected by an Arbitral Tribunal comprising three retired judges of the Supreme Court of India, followed by dismissal from a Single-Judge Bench of the same court.
Background of the Dispute
The legal dispute traces back to early 2015 when Kalanithi Maran and KAL Airways transferred their controlling 58.46 percent stake in SpiceJet to the airline’s original founder, Ajay Singh, for a nominal sum of ₹2 and an assumption of ₹1,500 crore in debt liabilities. The transfer was part of an urgent revival deal after the airline faced severe financial challenges and grounding.
Maran and KAL Airways later alleged that as part of the agreement, they had paid ₹679 crore to SpiceJet for issuing convertible warrants and preference shares — financial instruments that would have allowed them to maintain an equity interest in the carrier. They claimed that SpiceJet neither issued these instruments nor returned the money.
The dispute was referred to arbitration, which initially resulted in a partial award in favour of Maran, ordering SpiceJet to refund ₹579 crore along with applicable interest. However, subsequent legal challenges led the Delhi High Court and the Supreme Court of India to overturn parts of this award and send it for reconsideration.
In the interim, Maran and KAL Airways lodged a separate claim seeking over ₹1,300 crore in damages for alleged losses incurred due to the failure to issue the warrants and preference shares. This claim was also rejected by the Arbitral Tribunal and later dismissed by the Delhi High Court.
Market Reaction
Following news of the latest court decision, shares of SpiceJet rose in Monday morning trade. The stock climbed as much as 4.45 percent to reach ₹45.78 per share on the BSE, before settling at ₹44.97, up by 2.60 percent as of 10:55 a.m. local time.
Trading volumes were relatively modest, with around 6 million shares changing hands, lower than the two-week average of nearly 7.2 million. According to BSE data, the stock was trading above its five-day moving average but remained below longer-term averages.
Context
SpiceJet, founded in 2005 by Ajay Singh, has faced recurring financial pressures in recent years. The airline’s market capitalisation currently stands at around ₹5,766 crore. The carrier also recently reached a settlement in a separate dispute with US-based Willis Lease Finance Corporation, leading to the withdrawal of an insolvency plea against the airline.
The court’s latest dismissal of Maran’s damages claim represents a significant legal reprieve for SpiceJet, which continues to navigate operational and financial challenges in India’s competitive aviation sector. The airline industry in India has seen a resurgence post-pandemic, but carriers have grappled with high fuel costs, volatile market demand, and regulatory hurdles.
Kalanithi Maran, a media magnate and chairman of the Sun Group, had acquired a majority stake in SpiceJet in 2010 but exited in 2015 after the airline’s financial distress deepened.
This latest ruling is expected to conclude one of the airline’s most high-profile legal battles, though it remains to be seen whether any further appeals or proceedings will follow.
SpiceJet disclosed the outcome in a regulatory filing with the Bombay Stock Exchange (BSE), stating: “We would like to inform you that the Division Bench of Delhi High Court in its order dated May 23, 2025, has dismissed the appeal filed by KAL Airways and Kalanithi Maran seeking damages of more than ₹1,300 crore and other claims.”
The claims had previously been rejected by an Arbitral Tribunal comprising three retired judges of the Supreme Court of India, followed by dismissal from a Single-Judge Bench of the same court.
Background of the Dispute
The legal dispute traces back to early 2015 when Kalanithi Maran and KAL Airways transferred their controlling 58.46 percent stake in SpiceJet to the airline’s original founder, Ajay Singh, for a nominal sum of ₹2 and an assumption of ₹1,500 crore in debt liabilities. The transfer was part of an urgent revival deal after the airline faced severe financial challenges and grounding.
Maran and KAL Airways later alleged that as part of the agreement, they had paid ₹679 crore to SpiceJet for issuing convertible warrants and preference shares — financial instruments that would have allowed them to maintain an equity interest in the carrier. They claimed that SpiceJet neither issued these instruments nor returned the money.
The dispute was referred to arbitration, which initially resulted in a partial award in favour of Maran, ordering SpiceJet to refund ₹579 crore along with applicable interest. However, subsequent legal challenges led the Delhi High Court and the Supreme Court of India to overturn parts of this award and send it for reconsideration.
In the interim, Maran and KAL Airways lodged a separate claim seeking over ₹1,300 crore in damages for alleged losses incurred due to the failure to issue the warrants and preference shares. This claim was also rejected by the Arbitral Tribunal and later dismissed by the Delhi High Court.
Market Reaction
Following news of the latest court decision, shares of SpiceJet rose in Monday morning trade. The stock climbed as much as 4.45 percent to reach ₹45.78 per share on the BSE, before settling at ₹44.97, up by 2.60 percent as of 10:55 a.m. local time.
Trading volumes were relatively modest, with around 6 million shares changing hands, lower than the two-week average of nearly 7.2 million. According to BSE data, the stock was trading above its five-day moving average but remained below longer-term averages.
Context
SpiceJet, founded in 2005 by Ajay Singh, has faced recurring financial pressures in recent years. The airline’s market capitalisation currently stands at around ₹5,766 crore. The carrier also recently reached a settlement in a separate dispute with US-based Willis Lease Finance Corporation, leading to the withdrawal of an insolvency plea against the airline.
The court’s latest dismissal of Maran’s damages claim represents a significant legal reprieve for SpiceJet, which continues to navigate operational and financial challenges in India’s competitive aviation sector. The airline industry in India has seen a resurgence post-pandemic, but carriers have grappled with high fuel costs, volatile market demand, and regulatory hurdles.
Kalanithi Maran, a media magnate and chairman of the Sun Group, had acquired a majority stake in SpiceJet in 2010 but exited in 2015 after the airline’s financial distress deepened.
This latest ruling is expected to conclude one of the airline’s most high-profile legal battles, though it remains to be seen whether any further appeals or proceedings will follow.
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