Go First case: Delhi HC allows lessors to inspect, carry out maintenance of aircraft
The court asked the Director General of Civil Aviation (DGCA) and the airports where the aircraft are parked to permit the lessors to access their aircraft in the next three days.
- Jul 5, 2023,
- Updated Jul 5, 2023 4:26 PM IST
Two months after embattled airline Go First filed for voluntary insolvency resolution proceedings before the National Company Law Tribunal (NCLT), a single judge of Delhi High Court on Wednesday allowed the lessors to inspect and carry out maintenance work of their 30 aircraft and their parts in regular intervals.
In the HC interim order on Wednesday, Justice Tara Vitasta Ganju said that Go First's resolution professionals and employees cannot carry out any work on the leased aircraft without the “express permission” of the lessors.
The court further asked the Director General of Civil Aviation (DGCA) and the airports where they are parked to permit the lessors to access their aircraft in the next three days, and further noted that aircraft are expensive and complex machinery and require regular maintenance.
The lessors who are in high court include Accipiter Investments Aircraft 2 Limited, EOS Aviation 12 (Ireland) Limited, Pembroke Aircraft Leasing 11 Limited, SMBC Aviation Capital Limited, GY Aviation Lease 1722 co Limited, DAE SY 22 13 Ireland Designated Activity Company, SFV Aircraft Holdings IRE 9 DAC Limited and ACG Aircraft Leasing Ireland Limited. They filed a writ with the Delhi High Court and sought directions to release the planes.
On June 1, the Delhi High Court had reserved judgment in a batch of petitions filed by lessors of the Go First, who have been seeking the deregistration of their aircraft.
The high court asked the respondents – DGCA and IRP -- to file their responses to the petitions of the lessors within three weeks and listed the matter for further hearing on August 3. The HC will hear the cases in August again.
The lessors who had filed against the DGCA on its part said that they had not rejected any lessor's applications for repossession due to a moratorium.
It further stated that they don’t support the lessors or Go First in the dispute.
The lessors’ counsel told the court that the relationship between an airline and the aircraft lessor is contractual and that tinkering with the terms of the contract would have consequences for the Indian aviation sector.
They argued that the agreed principles between the aircraft lessor and the airline cannot be modified without legal sanction.
Earlier, The NCLT-appointed IRP, tasked with managing Go First, had told the high court that returning aircraft to the lessors will render the airline, which has 7,000 employees to look after, "dead".
On May 10, the National Company Law Tribunal (NCLT) had admitted the airline’s voluntary insolvency resolution petition and appointed Abhilash Lal as the IRP to manage the carrier.
With a moratorium in force on financial obligations and transfer of assets of Go First in the wake of the insolvency resolution proceedings, the lessors are unable to deregister and take back the aircraft leased to the carrier.
On May 22, the NCLAT upheld the NCLT's order admitting Go First's plea for insolvency.
On May 10, the principal bench of the NCLT in Delhi accepted Go First's voluntary plea to initiate an insolvency resolution process. The tribunal appointed an IRP, suspended the board, and imposed a moratorium on the airline's financial obligations.
Go First stopped flying on May 3 attributing the decision to problems with engines provided by Pratt & Whitney.
Also read: Reliance Industries stock offers favourable risk-reward ahead of AGM, says BofA Securities
Also read: HDFC Bank shares halt 5-day winning run, slip 3% post Q1 updates
Two months after embattled airline Go First filed for voluntary insolvency resolution proceedings before the National Company Law Tribunal (NCLT), a single judge of Delhi High Court on Wednesday allowed the lessors to inspect and carry out maintenance work of their 30 aircraft and their parts in regular intervals.
In the HC interim order on Wednesday, Justice Tara Vitasta Ganju said that Go First's resolution professionals and employees cannot carry out any work on the leased aircraft without the “express permission” of the lessors.
The court further asked the Director General of Civil Aviation (DGCA) and the airports where they are parked to permit the lessors to access their aircraft in the next three days, and further noted that aircraft are expensive and complex machinery and require regular maintenance.
The lessors who are in high court include Accipiter Investments Aircraft 2 Limited, EOS Aviation 12 (Ireland) Limited, Pembroke Aircraft Leasing 11 Limited, SMBC Aviation Capital Limited, GY Aviation Lease 1722 co Limited, DAE SY 22 13 Ireland Designated Activity Company, SFV Aircraft Holdings IRE 9 DAC Limited and ACG Aircraft Leasing Ireland Limited. They filed a writ with the Delhi High Court and sought directions to release the planes.
On June 1, the Delhi High Court had reserved judgment in a batch of petitions filed by lessors of the Go First, who have been seeking the deregistration of their aircraft.
The high court asked the respondents – DGCA and IRP -- to file their responses to the petitions of the lessors within three weeks and listed the matter for further hearing on August 3. The HC will hear the cases in August again.
The lessors who had filed against the DGCA on its part said that they had not rejected any lessor's applications for repossession due to a moratorium.
It further stated that they don’t support the lessors or Go First in the dispute.
The lessors’ counsel told the court that the relationship between an airline and the aircraft lessor is contractual and that tinkering with the terms of the contract would have consequences for the Indian aviation sector.
They argued that the agreed principles between the aircraft lessor and the airline cannot be modified without legal sanction.
Earlier, The NCLT-appointed IRP, tasked with managing Go First, had told the high court that returning aircraft to the lessors will render the airline, which has 7,000 employees to look after, "dead".
On May 10, the National Company Law Tribunal (NCLT) had admitted the airline’s voluntary insolvency resolution petition and appointed Abhilash Lal as the IRP to manage the carrier.
With a moratorium in force on financial obligations and transfer of assets of Go First in the wake of the insolvency resolution proceedings, the lessors are unable to deregister and take back the aircraft leased to the carrier.
On May 22, the NCLAT upheld the NCLT's order admitting Go First's plea for insolvency.
On May 10, the principal bench of the NCLT in Delhi accepted Go First's voluntary plea to initiate an insolvency resolution process. The tribunal appointed an IRP, suspended the board, and imposed a moratorium on the airline's financial obligations.
Go First stopped flying on May 3 attributing the decision to problems with engines provided by Pratt & Whitney.
Also read: Reliance Industries stock offers favourable risk-reward ahead of AGM, says BofA Securities
Also read: HDFC Bank shares halt 5-day winning run, slip 3% post Q1 updates