Annual Report cb smile - Jet Airways

Significant Accounting Policies and Notes to Accounts (contd.)
The future minimum lease payments in respect of non-cancelable period which, as at 31st March, 2010
are as follows:
Amount (Rs. in lakhs)
Total Lease
Commercial Premises and Amenities Payments
Less than 1 year 180
(562)
Between 1 and 5 years 340
(-)
More than 5 years -
(-)
Grand Total 520
(562)
(Figures in brackets indicates 31st March, 2009 figures)
ii) The Company has taken on operating lease aircraft and spare engines the future minimum lease payments
in respect of which, as at 31st March, 2010 are as follows :
Amount (Rs. in lakhs)
Total Lease
Aircraft and Spare Engines Payments
Less than 1 year 82,926
(88,157)
Between 1 and 5 years 230,032
(260,374)
More than 5 years 75,455
(91,509)
Grand Total 388,413
(440,040)
(Figures in brackets indicates 31 st March, 2009 figures)
The Salient features of an Operating Lease agreement are:
• Monthly rentals paid in form of fixed and variable rental. Variable Lease Rentals are payable on a pre
determined rate payable on the basis of actual flying hours. Additionally, the predetermined rates of
Variable Rentals are subject to the annual escalation as stipulated in the respective leases.
• The Company neither has an option to buyback nor does it generally have an option to renew the
leases.
• In case of delayed payments, penal charges are payable as stipulated.
• In case of default, in addition to repossession of the aircraft, damages including liquidated damages
as stipulated are payable.
• The Lessee is responsible for maintaining the aircraft as well as insuring the same. The Lessee is
eligible to claim reimbursement of costs as per the terms of the lease agreement.
• The leases are non-cancellable.
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