# In the matter of Spicejet Limited

> NCLT judgment dated 2023-12-04. Citation: TCN-2023-NCLT-00481. Willis Lease Finance Corporation filed an application under Section 9 of the Insolvency and…

- **Court:** NCLT
- **Order date:** 4 Dec 2023
- **Citation:** TCN-2023-NCLT-00481
- **Category:** IBC
- **Source page:** https://caseease.in/cases/ibc/nclt-division-bench-court-i-chenn/spicejet-limited-06e95674

## Summary

### Background

Willis Lease Finance Corporation filed an application under Section 9 of the Insolvency and Bankruptcy Code, 2016, seeking to initiate Corporate Insolvency Resolution Process (CIRP) against SpiceJet Limited. The application was based on unpaid operational debt. SpiceJet contested the maintainability of the petition, arguing that Willis Lease Finance Corporation was not an operational creditor as defined under the IBC, and that the demand notice was defective. The application was initially reserved on the issue of maintainability.

## Facts

Willis Lease Finance Corporation (WLFC) filed a Section 9 application under the Insolvency and Bankruptcy Code (IBC) to initiate Corporate Insolvency Resolution Process (CIRP) against SpiceJet Limited, claiming unpaid operational debt of Rs 53,96,65,759/- as of 2023-04-10. WLFC claimed to be an operational creditor based on its role as a 'Servicer' for various lessors who had lease agreements with SpiceJet. The debt arose from these lease agreements. SpiceJet argued that WLFC was not an operational creditor because the debt was owed to the lessors, not WLFC, and there was no direct contractual relationship between WLFC and SpiceJet. A prior Section 9 petition based on a similar demand notice had been withdrawn by WLFC. The demand notice relied upon by WLFC was dated

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## Issues and analysis

### Issue 1: Whether Willis Lease Finance Corporation qualifies as an 'operational creditor' under Section 5(20) …

**Ratio:** An operational creditor is defined under Section 5(20) of the IBC as a person to whom an

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**Reasoning:** The court reasoned that the lease agreements were executed between SpiceJet and the

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**Interpretation:** The interpretation of Section 5(20) and 5(21) of the IBC requires a direct

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**Application:** In this case, the court applied the ratio to the facts by noting that the lease

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## Parties

- **Judges:** MAHENDRA KHANDELWA…; RAHUL BHA…
- **Appellants:** Willis Lease…
- **Respondents:** SpiceJet L…
- **Advocates:** Virendra…; Ashim…; +10 more

## Timeline

- **2022-11-04 — Demand Notice…**: Willis Lease Finance Corporation issued a demand notice to SpiceJet for unpaid…
- **2023-02-01 — First Section 9…**: Willis Lease Finance Corporation filed the first Section 9 petition, reflecting the…

## Legal provisions

- [Insolvency and Bankruptcy Code, 2016, Section 9 — Application for initiation of corporate insolvency…](https://caseease.in/legal-provisions/insolvency-and-bankruptcy-code-2016/section-9)

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