MUMBAI: India’s top court has ordered the liquidation of bankrupt airline Jet Airways, ending a five-year legal process that began when the full-service carrier collapsed in 2019 with $1.2 billion in debt.

Once the country’s second-largest airline, Jet Airways went out of business five years ago after it ran out of cash and grounded its planes, with creditors forcing it into bankruptcy proceedings the same year.

A national company law tribunal last year allowed ownership of the airline to be transferred to a consortium of buyers that included UAE businessman Murari Lal Jalan as part of a bankruptcy resolution.

But concerns raised by creditors about how the resolution process was executed led to court appeals.

India’s Supreme Court struck down the ownership transfer on Thursday, saying the consortium did not meet the legal conditions for a takeover and that allowing the purchase to go ahead would be “perverse and legally unsustainable”.

The court also decreed that a bankruptcy court in Mumbai should begin the “necessary formalities to commence liquidation”, a process that will lead to the sale of the airline’s assets.

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The aviation sector in the world’s most populous country is highly competitive and several airlines have failed due to a combination of mismanagement, over-leveraging and adverse market conditions.

Debt-laden Indian airline Go First filed for bankruptcy protection last year, blaming “defective” engines from US aerospace company Pratt & Whitney for grounding about half its fleet.

Kingfisher Airlines closed in 2012 after failing to repay millions of dollars in loans to state-owned banks.

Its owner, beer magnate Vijay Mallya, fled India four years later and is fighting his extradition from London to face financial fraud charges back home.