Avolon, one of the world's biggest aircraft lessors, applied to de-register two planes it had placed with Jet Airways, making it the first lessor to do so on a non-consensual basis with the struggling airline.
Two subsidiaries of Dublin-based Avolon applied to Directorate General of Civil Aviation (DGCA) to de-register two Boeing 737-800s, according to notices published on the regulator's website.
Avolon has terminated the leases on the planes and currently has five more aircraft placed with Jet, said sources who declined to be identified due to the sensitivity of the matter.
There was no immediate response from Avolon to queries sent by Reuters.
The move by Avolon indicates an escalation of a crisis for Jet.
The airline, now controlled by its lenders, has had to ground more than three-quarters of its fleet of 119 planes, many due to non-payment to lessors, leading to hundreds of flight cancellations.
With debt of more than $1 billion, Jet has struggled to pay lenders, suppliers, pilots and lessors for months and was on the brink of bankruptcy, but was bailed out last month by state-run banks.
The consortium of lenders temporarily took a majority stake in the company, and agreed to issue a loan of Rs 1,500 crore ($217 million) to meet Jet's obligations but the money has still not been released.
Frustrated by the unpaid dues, Jet's lessors, including many of the world's biggest players such as GE Capital Aviation Services, Aercap Holdings and BOC Aviation have taken control of their planes, sources said.
Reuters reported last month that some of Jet's lessors had begun terminating lease deals. Since then, they have also moved a handful of planes out of India after getting a go-ahead from the airline.
Once the country's leading full-service carrier, Jet's operational fleet stood at 28 planes as of Wednesday, a spokesman said.
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