Jet-Sahara hearing to begin tomorrow

SKY WAR: Jet Airways claims all conditions precedent to the deal were not fulfilled by Sahara.

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New Delhi: The tribunal will on Monday begin the final hearing in the Jet-Sahara deal matter for two weeks on a daily basis.

The three-member tribunal headed by British judge Lord Stein includes retired Supreme Court Chief Justices S P Bharucha arbitrating for Jet Airways and Justice Jeevan Reddy for Air Sahara.

In January 2006, Jet Airways had signed a share-purchase agreement (SPA) to acquire 100 per cent equity stake in Air Sahara.

As part of the deal, Jet paid Rs 180 crore for revival of Air Sahara and Rs 500 crore for Air Sahara shares, besides depositing Rs 1,500 crore in the escrow account opened for the purpose.

Later on the Bombay High Court had allowed Jet Airways to withdraw the Rs 1,500 crore from the escrow account against a bank guarantee of the same amount in September last year.

After the deal fell through - following Jet's failure to get regulatory clearances by the deadline of June 21 last year - both parties moved court and the matter was directed for arbitration.

While arbitration hearings are on from September 9 2006, the panel is now set for final hearing and disposal of the issue.

Jet Airways claims that all conditions precedent to the deal were not fulfilled by Air Sahara and it was justified in walking out of the deal.

But Sahara Airways argues that getting clearance of Jet chairman Naresh Goyal on the Air Sahara board was not a condition precedent.

The three-member tribunal will focus on whether the specific conditions determined by the parties while signing the SPA were met before the cut-off date or not.

(With agency inputs)