HC refers dispute between Jet and Sahara to arbitrator

Mumbai, Feb 28 (UNI) The Bombay High Court today referred a dispute to an arbitrator on the failed takeover bid of Sahara Airlines by Jet Airways, whereby they were seeking to recover Rs 500 crore from Sahara Airlines.

Observing that there is a clause of arbitration in the agreement between the two Airline companies, Special court Judge D K Deshmukh disposed off the the suit filed by Jet Airways, seeking decree to recover Rs 500 crore from Sahara Airlines and referred the same to arbitrator. Now the issue will be added to matters already referred earlier to the arbitrator.

The dispute relates to failed takeover bid of Sahara Airlines by Jet for which the latter had entered into an agreement with the Sahara group company to purchase cent percent shares in the Airlines on January 18, 2006.

The proposed transaction was supposed to be completed within 65 days from the date of the agreement. As the deal could not be completed within the stipulated time, another agreement on January 20, 2006, was done thereby extending time to complete the deal upto 265 days. This agreement also allowed the Sahara group to withdraw Rs 500 crore, out of Rs 2,000 crore deposited by Jet in an escrow account and through this litigation Jet is now tring to recover that amount for which Sahara group Chairman Subrato Roy had stood as personal guarantee.

UNI