The peculiar purchase of SpiceJet three years ago is creating fresh ruckus. Although Ajay Singh, current promoter of SpiceJet, boasts about turning around the loss-making airline that he had acquired for Rs 2, his bitter fight with former SpiceJet promoter Kalanithi Maran (of Sun Group) continues to simmer.

When Singh took over SpiceJet in 2014, the carrier was in a bad shape. It did not have enough cash to pay the lessors, oil companies and employees. When Maran exited the company by selling his 58.46 per cent stake, he gave around Rs 350 crore to the carrier to pay some of the dues. In return, a contract - a sales and purchase agreement (SPA) - was signed between Singh and Maran that has been a bone of contention. According to the terms of the contract, Maran was entitled to get 18.91 crore warrants worth Rs 309 crore and non-convertible cumulative redeemable preferential shares worth Rs 370 crore.

SpiceJet says it could not issue warrants to Maran as objections were raised by the Bombay Stock Exchange on SPA terms. Subsequently, Maran approached Delhi High Court, which ruled in his favour asking SpiceJet to deposit Rs 579 crore in the form of bank guarantees and cash deposits by August 31. SpiceJet says it is ready to issue the warrants but there are regulatory hurdles. The Marans, on the other hand, have raised doubts about Singh's intent to pay back the agreed dues. Both parties now expect resolution through arbitration that kicked off late last year.

According to people familiar with the matter, Maran believes that he has acted in good faith, believing that the SPA terms will be honoured. "He feels that he should not be penalised if there is something wrong between the company and the stock exchange. They do not want damages. In arbitration, they are looking for restitution of the contract following which they want to be compensated for the loss," says a person familiar with the matter on condition of anonymity. Spokespersons of SpiceJet and Sun Group refused to comment for this story as the matter is sub judice.

SpiceJet, which came close to a shutdown, is the fourth largest airline in terms of market share. The low-cost carrier has seen a turnaround over the past three years, registering a net profit of Rs 427.22 crore in 2016/17. Sources say that SpiceJet blames Maran for unnecessarily heckling the current management, especially as the airline is doing well. "While Maran pumped in some money at the time of exit, nobody remembers the massive amount of liabilities that Singh had to take over during the acquisition. The Marans did not have the skills to make sure that their interests are protected and that is hurting them now," says another source who does not want to be named.

The Marans have hired US-based FTI Consulting to estimate the amount SpiceJet owes to them, and have reportedly filed a report claiming damages of Rs 2,500 crore. The issue is likely to be settled in September when arbitration is expected to conclude.