Lenders to Jet Airways said they plan to bring insolvency proceedings against the struggling carrier.
The move follows a failed attempt to find a suitable buyer.
Jet Airways, India’s biggest private carrier, has been hampered by more than $1bn (£765m) of debt.
In April, the airline suspended all international flights. The move left passengers passengers stranded in India and European cities including London, Paris and Amsterdam.
Jet Airways was formed in 1993 after India liberalised its economy and allowed competition from private carriers.
The rise of Jet Airways coincided with the decline of Air India, which was plagued by poor service and bad business decisions.