Go First Takes Legal Action Against High Court Ruling on Aircraft Inspection by Lessors

According to the resolution professional of the grounded airline, Go First, it plans to challenge the Delhi High Court’s ruling that allows its lessors to inspect the aircraft. The resolution professional points out inconsistencies between this order and the one issued by the National Company Law Tribunal (NCLT) in the case. Go First, a cash-strapped budget carrier ceased operations on May 3 and is currently undergoing insolvency resolution. The aviation regulator, DGCA, is conducting a special audit of the airline, which has sought approval to resume its operations.

During the proceedings at the NCLT, senior advocate Ramji Srinivasan, representing the resolution professional of Go First, stated that the airline intends to challenge the high court’s order. He emphasized the disparities between the order issued by the high court’s single-member bench and the directions provided by the NCLT.

“We are currently considering challenging the high court’s order based on our present understanding,” he expressed.

Shailendra Ajmera serves as the resolution professional for the airline.

On Wednesday, Justice Tara Vitasta Ganju of the Delhi High Court issued a 46-page order clarifying that the resolution professional does not need to assume control of assets owned by third parties.

Additionally, the high court instructed the Directorate General of Civil Aviation (DGCA) to allow lessors, their employees, and agents access to the airport where 30 aircraft are currently parked. They were given a three-day period to inspect these aircraft.

As per the previous order from the National Company Law Tribunal (NCLT), the resolution professional is responsible for maintaining the airworthiness of the aircraft and engines under their possession.

Go First, currently undergoing the Corporate Insolvency Resolution Process (CIRP), had its voluntary plea for initiating resolution proceedings accepted by the NCLT on May 10.

Special Audit Committee

Srinivasan informed the tribunal that the DGCA has established a special audit committee to assess the aircraft and ensure its readiness before granting permission to resume operations in accordance with the business resumption plan.

He mentioned that the report from the DGCA is anticipated within the next few days.

Furthermore, he announced that the lenders have successfully provided funding of Rs 450 crore. This substantial amount will also provide a boost to sustain the operations of the airline.

In the meantime, the airline has submitted its response to the tribunal regarding the pleas filed by the lessors of aircraft and engines.

The lessors have accused the resolution professional of failing to comply with the NCLT’s previous order regarding the maintenance of their aircraft.

JSAIL (Jackson Square Aviation Ireland Ltd), one of the lessors, informed the tribunal that the actions taken by the resolution professional are harming Go First’s interests.

Arun Kathpalia, representing the lessors, argued that retaining the aircraft would only result in increased costs and further difficulties for Go First.

A two-member bench of the NCLT, consisting of Members Mahendra Khandelwal and Rahul Prasad Bhatnagar, granted the lessors one week to submit their rejoinder.

The tribunal has scheduled a hearing on August 4 to address the matter.

Therefore, the NCLT was handling a series of petitions filed by nine lessors of Go First, including EOS Aviation, Accipiter Investments Aircraft, SMBC, Jackson Square Aviation, Engine Lease Finance, and BOC Aviation.

Following a directive from the appellate tribunal NCLAT in June, the lessors approached the NCLT to address concerns regarding the moratorium on their aircraft.

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