The appeals panel had scheduled a decision on the aircraft lessors’ argument on May 15.
On May 10, Go First’s voluntary request to start an insolvency resolution procedure was accepted by the NCLT’s Delhi main bench.
Go First was relieved when the National Company Law Appellate Tribunal (NCLAT) affirmed the NCLT’s decision on the airline’s insolvency on May 22. Lessors have been requested to submit a suitable application to NCLT.
The ruling of the National Company Law Tribunal (NCLT) allowing the cash-strapped airline’s request for insolvency was contested by the aircraft lessors to Go First, namely SMBC Aviation Capital, SFV Aircraft Holdings, and GY Aviation Lease. Go First is exploiting the insolvency procedures to hang onto aircraft that it does not own, according to the lessors’ argument at the NCLAT.
Aviation lessor Despite having 26 operational aircraft and accepting reservations for future dates, SMBC questioned the justification for Go First’s petition for voluntary insolvency.
According to SMBC Aviation, Go First owes it between Rs 700 and Rs 800 crore in outstanding debt. The National Company Law Tribunal (NCLT), according to SMBC, approved Go First’s insolvency claim without fully investigating the circumstances and denied them the chance to offer their side of the story.
The aircraft lessor claimed that even though they had previously ended the leases before the NCLT imposed the moratorium, they were still unable to take ownership of the aircraft as a result of the tribunal’s ruling. The leasing business said that Go First cannot operate aircraft after the contract expires due to aviation regulations.
Go First contended that it had started insolvency proceedings with good faith hopes of safeguarding the 7,000 people on its payroll and guaranteeing that the nation’s aviation industry benefits from robust competition. The airline denied the lessors’ allegations, claiming they were manufactured for malicious purposes.
The Interim Resolution Professional (IRP) for Go First, who was represented by his attorney, stated that the airline owes its suppliers more than Rs 1,000 crore and that the bankruptcy process will only aid in the repayment of its debts.
On May 15, the tribunal put their request for judgment on hold.
On May 10, Go First’s voluntary request to start an insolvency resolution procedure was accepted by the NCLT’s Delhi main bench. The tribunal suspended the board and imposed a moratorium on the debt-ridden airline’s financial obligations while also appointing an IRP.
Go First, formerly known as GoAir and founded by billionaire Nusli Wadia, filed for bankruptcy on May 2. It blamed US engine manufacturer Pratt & Whitney for forcing half of its fleet to land. Liabilities for the low-cost carrier are about Rs 11,000 crore.
