Grounded airline Go First's Resolution Professional (RP) Shailendra Ajmera has in an affidavit filed at the Delhi High Court stated that none of the 2278 employees on the airline's rolls are reporting to work.
"As of the insolvency commencement date, the number of employees on the rolls of Go First stood at 4,621. However, as of October 10, approximately 2,278 employees remain on the rolls of the Company, out of which none are at present reporting to work," the affidavit said.
Ajmera's affidavit is a response to a contempt petition filed by a lessor to the airline alleging that RP was not permitting inspection of their aircraft as well as not maintaining them as per the directions of the court. The RP in the affidavit has outlined the steps taken by him to continue maintaining, whilst also informing the court that the lack of operational cash flows has made it impossible for him to retain professionals required to maintain aircraft.
The RP has contended that the cash flows are affected due to efforts of the lessors in stalling the implementation of the resolution plan as a result of which, the airline has not been able to resume its commercial operations and generate revenue. This has led to a situation where salaries are unpaid.
According to the affidavit, after the commencement of the insolvency process, the existing funds available with the company were utilised to make payment of salaries for May 2023, and the salary payments for June 2023 were paid in August 2023 out of the corpus provided by the lenders. However, salaries have not been paid from July 2023 onwards, which has led to the non-reporting of employees and staff to corporate offices and various stations where the aircraft are currently parked.
"Over this period, various personnel of the engineering and records team
who were required to undertake maintenance activities have either gradually resigned or are not reporting to work due to non-payment of salaries," the affidavit said. The employees/ workers of the Corporate Debtor whose salaries are unpaid include/ engineers and technical personnel with specialized expertise required for carrying out routine maintenance of the aircraft under the procedures.
Contempt case:
DAE (SY22) 13 Ireland Designated Activity Company, an aircraft lessor to the grounded airline Go First, filed a contempt petition in the Delhi High Court, alleging that the carrier's resolution professional (RP) had wilfully refused to comply with the court's orders.
"The RP's wilful refusal to grant the petitioner access to its aircraft records/documents is in clear and deliberate violation of the judgment dated October 12," the plea read.
Delhi High Court litigation
The lessors moved a plea in the Delhi HC against the DGCA, requesting the court to direct the authority to deregister their aircraft. They argued that the authority should deregister the aircraft if demanded by lessors.
On July 5, the High Court, in an interim order, permitted the lessors to inspect and perform the maintenance work. However, a division bench of the Delhi High Court on July 12 modified the order to the extent that the lessors could only inspect the aircraft while the insolvency resolution professional (RP) appointed under the IBC could carry out maintenance. The Supreme Court upheld the order of the Delhi High Court.
On October 12, the High Court permitted the lessors of the grounded airline to engage security personnel to monitor their aircraft, engine and other parts. “A review of the documents and photographs filed by the Petitioners/Lessors show the evident cannibalisation of the Aircraft,” the high court order said.
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