NCLT orders liquidation of Go First

Go First had initiated a voluntary insolvency resolution process in May 2023

The National Company Law Tribunal has ordered liquidation of the grounded low-cost airline Go First.

A bench of NCLT comprising Judicial Member Mahendra Khandelwal and Technical Member Dr. Sanjeev Ranjan allowed an application for liquidation filed by the Committee of Creditors (CoC) of Go First.

The CoC had filed an application to liquidate the airline in September 2024, after the airline was left with no aircraft and no viable revival option. The application was reserved for judgment in December 2024.

By October last year, one-fourth of the erstwhile fleet of 54 aircraft was out of India. In the next three months, the speed at which the planes are returning has gone up with over half the fleet of 54 planes having flown out of India by December 31, 2024, the lawyers representing the CoC First said in NCLT.

As of the end of December, 28 out of the airlines' 54 aircraft have been reposed by lessors, the lawyers said.

Go First had initiated a voluntary insolvency resolution process in May 2023.

Go First owes Rs 6,521 crore to lenders, including Bank of Baroda, Central Bank of India, Deutsche Bank and IDBI Bank, according to the information provided by the airline. Central Bank of India had the highest exposure of Rs 1,987 crore, followed by Bank of Baroda at Rs 1,430 crore, Deutsche Bank at Rs 1,320 crore and IDBI Bank at Rs 58 crore.

Go First’s key remaining asset is a 94-acre parcel of land in Thane that the Wadia Group had given as collateral to the banks. The land is valued at approximately Rs 3,000 crore. Apart from the land, the airline’s assets also include an Airbus training facility in Mumbai and its headquarters.

Apart from money owed to banks, the airline owes around Rs 2,000 crore to various aircraft lessors, around Rs 1,000 crore to its vendors, around Rs 600 crore to travel agents, and Rs 500 crore to customers with pending refunds.

Go First has also borrowed Rs 1,292 crore under the Centre’s emergency credit scheme, introduced during the Covid crisis. The ultra-low-cost airline’s total liabilities amount to around Rs 11,000 crore, including its obligation to lessors.

The Wadia Group airline stopped flying on May 2, 2023, and the NCLT had admitted its plea for voluntary insolvency eight days later.