The National Company Law Tribunal (NCLT) on June 12 extended the Corporate Insolvency Resolution Process (CIRP) of the grounded airline Go First by 60 days after it was told that three parties had shown interest in taking over the carrier.
"We are not recording this in the order, but this is the final extension," the NCLT said while passing the order. This is the fourth extension given to the company at the request of its lenders. The CIRP will now expire on August 3, 2024.
During the course of the hearing, the lawyer for the airline's resolution professional (RP) told the court that they were seeking this extension owing to an extraordinary situation post the Delhi High Court judgment asking DGCA to deregister all of its 54 aircrafts. According to the RP, those who have shown interest in buying the airline have revised their offers and the lenders are yet to consider them, hence the 60 day extension is needed.
The NCLT, however, came down very heavily on the RP for seeking extension after extension without there being a concrete development in the resolution plan. "The lenders cannot simply pass a resolution to extend the resolution process and expect us to pass order," the NCLT said.
According to the Insolvency and Bankruptcy Code (IBC), 2016, a resolution process must be completed by 180 days and the NCLT has the powers to extend the period for completing the resolution process to a maximum of 330 days. If there is no resolution to a company's insolvency even at the end of 330 days, the NCLT has to order liquidation of the company. The 330 days ended in April 2024, however the NCLT is continuing to grant time using its discretionary power to ensure that the airline is back on its feet.
Go First, formerly known as GoAir, had received two bids for its acquisition on February 26. The consortium of SpiceJet's chairman and managing director Ajay Singh and Busy Bee Airways, associated with EaseMyTrip's chief executive officer Nishant Pitti, submitted a joint bid in their personal capacity, while the other bid is from Jaideep Mirchandani-owned Sky One Airways.
However in May 2024, reports emerged that EaseMyTrip's Nishant Pitti, announced the withdrawal of his personal bid from the GoAir acquisition process.
On May 2, 2023, Go First filed a plea in the NCLT under Section 10, asking to be admitted to the Corporate Insolvency Resolution Process . On May 10 2023, the NCLT admitted the plea and appointed a resolution professional to run the affairs of the company.
Discover the latest Business News, Sensex, and Nifty updates. Obtain Personal Finance insights, tax queries, and expert opinions on Moneycontrol or download the Moneycontrol App to stay updated!
