The National Company Law Tribunal (NCLT) on May 13 deferred the hearing of grounded airline Go First's insolvency plea to July 11 amid concerns over the airline's future.
The airline's Resolution Professional's lawyer did not make any statement on the next course of action of the airline during the hearing today. Anandh Venkatramani, the lawyer for engine lessor, Engine Lease and Finance, asked the NCLT to pass an order on deregistration of the engines as their fates are tied with that of the aircrafts. ELFS had not moved the Delhi High Court to deregister their engine.
According to Venkatramani, some of the aircraft have leased engines and not their own and if the aircraft need to leave the country post deregistration, the engines also need to be deregistered. Hence, he urged the tribunal to pass an order on the lines of Delhi HC's order.
The airline is now aircraft-less after the Delhi High Court on April 26 directed the aviation regulator Director General of Civil Aviation (DGCA) to deregister the aircraft. Subsequently, the DGCA deregistered all of its 54 aircraft in the first week of May.
The court had directed that all maintenance tasks in respect of the aircraft will be undertaken by the lessors and all their authorised representatives up to and until the time the aircraft are de-registered and exported, in pursuance of Rule 32A of the Aircraft Rules.
While the DGCA had initially said that it could not deregister these aircraft owing to the moratorium having set, the Ministry of Corporate Affairs issued a notification on October 4, 2023 stating that the provisions of sub-section (1) of section 14 of the Insolvency and Bankruptcy Code, 2016 (IBC), would not be applicable to transactions, arrangements or agreements relating to aircraft, aircraft engines, airframes and helicopters.
In its bankruptcy filing from May 2023, Go First had blamed its financial crunch on “faulty” engines of US-based Pratt & Whitney, claiming it was forced to ground 28 of its 56 planes. The grounded airline reportedly owes its creditors over Rs 6,200 crore.
Go First, founded in 2005 and formerly backed by the Wadia Group, filed for insolvency on May 2, 2023 and ceased flights the following day, blaming engines supplied by American aerospace manufacturer Pratt & Whitney.
The airline’s total liabilities to all its creditors amount to about Rs 11,463 crore, encompassing dues to banks, financial institutions, vendors, and the aircraft lessors.
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