PIA failed to pay lease amount ‘due to Covid’

Minister says PIA officials will appear before London court on Jan 22, Malaysian court on Jan 24

RAWALPINDI:

Federal Minister for Aviation Ghulam Sarwar Khan on Saturday said the Pakistan International Airlines (PIA) had failed to pay lease on time due to the coronavirus pandemic and the Malaysian court issued an order without listening to the arguments of the national flag carrier.

Talking to media persons, the minister said the PIA officials would appear before a London court on January 22 and a Malaysian court on January 24 after which the national carrier would accept the decision of the courts.

The PIA had acquired the plane on expensive lease during the Pakistan Muslim League-Nawaz (PML-N) tenure, he added.

“Two PIA planes were leased by the PML-N government in 2015, which expired in June, but due to the coronavirus, their instalments were not paid on time.

Read more: PIA plane 'impounded' in Malaysia over $14m lease dispute

“Our case regarding the plane is already pending in a British court,” Sarwar said. “In the meanwhile, our plane was stopped by filing a case in the Malaysian court … without any prior notice and decision.”

On Friday, the PIA spokesperson said that the plane had been held back by Malaysian authorities due to a British court case over the jet's lease, adding that it would pursue the matter through diplomatic channels.

The Boeing 777 aircraft was seized after a court order, the spokesperson said, and alternative arrangements were being made for passengers due to fly from Kuala Lumpur back to Pakistan.

The case involved a $14 million lease dispute, a PIA official said. "A PIA aircraft has been held back by a local court in Malaysia taking a one-sided decision pertaining to a legal dispute between PIA and another party pending in a UK court," the spokesperson said in a statement.

"PIA's legal team will pursue it in the Malaysian court, and we hope that we will resolve this issue as soon as possible."

According to orders passed by the Kuala Lumpur High Court on Thursday, the plaintiff of the case is Peregrine Aviation Charlie Limited and the matter pertains to two jets leased to PIA by Dublin-based AerCap, the world's largest aircraft lessor, in 2015.

They are part of a portfolio that AerCap sold to Peregrine Aviation Co Ltd, an investment unit of NCB Capital, the brokerage arm of National Commercial Bank SJSC, in 2018. According to the interim injunction, PIA is restrained from moving two aircraft in its fleet - a Boeing 777- 200ER with serial number 32716 and a Boeing 777- 200ER with serial number 32717 - once they have landed or parked at Kuala Lumpur International Airport until a further hearing on the matter later this month.

(With additional input from news desk)