India’s Supreme Court has rejected State Bank of India’s appeal over Jet Airways’ insolvency, leaving in place orders that require former employees’ provident fund and gratuity dues to be paid in full. The dispute centres on about ₹476 crore owed to staff, with the court’s decision preserving the treatment of those claims outside the usual liquidation waterfall in the airline’s ongoing winding-up process in India.
The ruling keeps intact earlier directions from the National Company Law Appellate Tribunal and the National Company Law Tribunal, which had held that the statutory employee dues could not be folded into the estate available for distribution among creditors. Lenders had argued that the liabilities should rank alongside other claims in liquidation, while workmen sought full protection for provident fund and gratuity entitlements.
The case has become an important reference point in Indian insolvency law because it affects how creditor recoveries are allocated when a carrier fails. Jet Airways has already been in liquidation, and the latest decision leaves the employee dues to be handled separately from the assets available to financial creditors.