Rs 2,300 cr Jet-Sahara deal lands up in court

Lucknow, June 21 (UNI) A local court today stayed the operation of the escrow account of Jet Airways at ICICI Bank till June 23 and also restrained making payment of this amount to Jet Airways.

With this, the Rs 2,300 crore Jet-Sahara deal landed up in the court.

In his two-page judgement, Lucknow district judge Shiv Charan Sharma said Jet shall not withdraw the amount deposited in the escrow account.

The court also restrained the ICICI Bank from making any payment from the account.

Commenting on the petition of Air Sahara in the district court, the judge said as there is a dispute between the two parties and there is arbitration clause, hence the petition is maintainable and be registered as a regular suit.

''As the counsel for the opposition parties requested for a short date, hence June 23 has been fixed for next hearing.'' It has been alleged by the petitioner, the respondent has terminated the contract, hence there is a dispute and for which the arbitrator is to be appointed in due course of time.

There is a contract and there is a dispute, hence the petition under section-9 in maintainable.

The court observed that as counsel for the petitioner said from the midnight of June 21 (today), the opposition party shall be at liberty to withdraw the amount from escrow account and if Jet was successful in withdrawing the amount, then the petition shall be infructuous.

During hearing, counsel for Jet, Rajesh Tiwari argued the petition may be admitted only after considering objection of the respondent.

But, the court maintained that respondent was fully competent and entitled to file objection even after the case has been registered.

Firstly it must be registered and then objection filed and if the petition is not maintainable, these objections can also be raised at the preliminary stage and if the petition will be maintainable then the objection will be dismissed as not maintainable, the court observed.

Admitting the petition filed by Sahara counsel Bulbul Gidiyal, the judge in his order said firstly it may be registered as a suit.

Undisputedly, an agreement was executed in between the parties.

There is an arbitration clause in the agreement, it has been provided in clause-19 of the agreement that in case of dispute in between the parties, the matter shall be referred to the Arbitrator.

The petition was filed by Sahara India Commercial Corporation Limited and others vs Jet Airways under section 9 of the Arbitration and Conciliation Act, 1996.

UNI MB VS PA RP DB2054