In a major setback for Go First, the Delhi High Court has directed civil aviation regulator Director General of Civil Aviation (DGCA) to process the deregistration applications of aircraft leased by the airline with in five working days.
Justice Tara Vitasta Ganju refused the request of the Resolution Professional (RP) to keep the operation of the order in abeyance for a week to enable them to file an appeal before the Division Bench of the court. As a result of which, the airline is at the threat of losing all its 54 aircraft if the RP does not obtain a stay of this order.
The court has thus quashed the communications sent by the DGCA in May 2023 telling the lessors that their application for deregistering the aircraft was in abeyance owing Go First entering moratorium.
In the order pronounced in the court, the RP has been directed to furnish upto date details regarding the maintenance of the aircraft to the lessors. The Airport Authority of India (AAI) will now have to communicate with the lessors regarding export of aircraft and airworthiness of the equipment. Lessors who do not wish to export their aircraft can move the court to take appropriate steps. The RP has been restrained from accessing the aircraft henceforth.
Aircraft lessors, including Pembroke Aviation, Accipiter Investments Aircraft 2, EOS Aviation and SMBC Aviation filed a writ in May 2023 before the Delhi High Court, seeking directions to release the planes leased to the financially distressed airline.
While the DGCA had initially said that it could not deregister these aircrafts owing to the moratorium having set, 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.
DGCA filed an affidavit in Delhi High Court clarifying that the notification exempting aviation leases from moratorium under the IBC should apply to pending cases as well. Simply put, DGCA's response states that the notification exempting aviation leases from moratorium should ideally apply to Go First, however the regulator will wait for directions from the High Court, as the matter is subjudice.
While the litigation was pending, two bids were submitted for Go First - from a consortium led by SpiceJet chief Ajay Singh and Nishant Pitti's Busy Bee Airways, and another one from Sharjah-based Sky One. Ajay Singh and Busy Bee Airways have jointly submitted a bid of Rs 1,600 crore ($193.10 million) for the airline, bankers said. The lenders of the airline are yet to take a final call on them.
Go First was admitted into insolvency resolution process in May last year after it had filed a voluntary plea for insolvency.
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