Jet Airways owes over Rs 8,000 crore to a consortium of 26 banks led by the State Bank of India.

Jet Airways

shares locked in 10 percent lower circuit at Rs 61.50 on June 18 after a media report indicated that State Bank of India filed insolvency petition against the company to recover dues.

The stock lost 50 percent of its value in the last seven days. At 10:16 hours IST, there were pending sell orders of 403,240 shares, with no buyers available.

Country’s largest lender State Bank of India approached National Company Law Tribunal in Mumbai against cash-strapped Jet Airways on behalf of the consortium of lenders, reports CNBC-TV18 quoting unnamed sources.

The report said SBI has filed insolvency petition against the airline in Mumbai bench of NCLT and proposed Ashish Chhawchharia of Grant Thornton as Resolution Professional.

After a meeting of the 26 lenders on Monday, SBI said, “after due deliberations, the lenders have decided to seek resolution for Jet Airways under the bankruptcy code since only a conditional bid was received”.

The statement further said the move was necessitated as the prospective investor wants some SEBI exemptions for a possible deal which can be worked out better under the bankruptcy laws.

The decision of the lenders to seek bankruptcy process through the NCLT comes exactly two months after the airline stopped flying on April 17, after being on the fringe since last July.

The Etihad-Hinduja consortium had reportedly shown interest but not given a concrete proposal yet, forcing the lenders to take the NCLT plunge as they have asked for a large haircut from the lenders.

Mumbai bench of NCLT will hear the operational creditors plea on June 20.

Jet Airways owes over Rs 8,000 crore to a consortium of 26 banks led by the State Bank, which now run the airline, while it has a much larger debt pile by way of accumulated losses to the tune of Rs 13,000 crore and vendor dues of over Rs 10,000 crore and salary dues of over Rs 3,000 crore.

The once largest private sector airline started over 25 years ago by airline-ticketing-agent-turned-entrepreneur Naresh Goyal stopped flying on April 17 after it ran out of cash and the unpaid lessors took away most of its 100-odd operational airplanes.