Mumbai: A group of former employees of Jet Lite (India) Ltd., a wholly owned subsidiary of the defunct Jet Airways (India) Ltd., have approached the National Company Law Tribunal (NCLT), Mumbai Bench, seeking admission of their long-pending employment dues in the ongoing liquidation proceedings of Jet Airways.
The interlocutory application has been filed advocate Nidhi Chheda on behalf of petitioner Yogen Vaman Vernekar and 99 other employees, invoking Section 60(5) of the Insolvency and Bankruptcy Code (IBC). The applicants have urged the tribunal to direct the liquidator of Jet Airways to admit their claims for unpaid salaries, gratuity, leave encashment and other statutory dues, which they say have been wrongfully excluded from the insolvency and liquidation process.
According to the application, the employees were originally employed by Jet Lite but were seconded to Jet Airways in 2008, where they continued to work under the direct supervision, control and management of the parent company until operations of both airlines ceased in April 2019. The applicants argue that despite Jet Lite being a separate legal entity on paper, the two companies functioned as a single integrated airline with common management, branding, HR systems, operational control and financial interdependence.
The employees have claimed that their aggregate unpaid dues for the period January to June 2019 alone amount to nearly Rs 48 crore, excluding further statutory accruals. Several of the affected employees have since died, with their legal heirs pursuing the claims.
The applicants have alleged discriminatory treatment, stating that while claims of Jet Airways employees were admitted during the Corporate Insolvency Resolution Process (CIRP), identical claims of Jet Lite employees were rejected on the ground that Jet Lite was a separate corporate entity. They have further contended that the resolution professional and the liquidator have selectively consolidated assets of Jet Lite for creditor benefit, while refusing to recognise corresponding employee liabilities.
“The Applicants have been repeatedly approaching the NCLT for more than 5 years with their predicaments, in order to seek redressal of their grievances. However, despite repeated attempts, the adjudication of the Petition(s) and Application(s) filed by the Applicants continues to remain pending. The aviation company have miserably failed to pay, not just the salaries of the Applicants, but also failed to pay various other statutory amounts due to the Applicants, such as gratuity, leave encashment amounts etc,”the petition reads.
The petition further speaks about the extensive operational integration — including common directors, shared offices, pooled finances, unified branding, and interchangeable workforce — the applicants have urged the tribunal to apply the doctrine of substantive consolidation and pierce the corporate veil to prevent what they describe as grave injustice to workmen.
They have also sought interim relief restraining distribution of liquidation proceeds until their claims are adjudicated, or alternatively, creation of a reserve or escrow to safeguard their dues.
The NCLT after going through the petition have granted the the liquidator Satish Kumar Gupta, appointed for the Jet airways limited, a time till January 12, since he had sought time to file the reply in the case since the claim is in relation to the employment services rendered to Jet Lite, which is an independent company.
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