Go First resolution professional approaches Delhivery for settlement, NCLT to hear plea on Aug 17

Go First, which is in talks to revive its operations, has approached logistics provider Delhivery for a settlement. The Resolution Professional (RP) of cash-strapped airline told the National Company Law Tribunal (NCLT) on Monday that it is exploring a settlement with logistics company Delhivery. 

In June, Delhivery had challenged the airline's voluntary insolvency in NCLT noting that the debt-ridden airline intentionally took payments from them despite knowing that it was filing for voluntary insolvency.    

The bankruptcy court had issued a notice to the Resolution Professional over the plea. 

"We are looking at settling with them," the counsel submitted before the NCLT, while seeking more time to complete the talks. 

According to the application filed in NCLT by Delhivery, the airline received over Rs 1.58 crore from the logistics company for rendering domestic cargo consignment services but never acted on it. The money was paid according to the terms of an agreement that the companies entered into in 2020 and was last renewed in August 2022. 

The plea further mentioned that Go First received the payment of Rs 57 lakh on May 2, the day when the airline filed for the Corporate Insolvency Resolution Process (CIRP) in the NCLT. 

It further stated that the sole intent of Go First in preferring the insolvency petition is to hijack the process in the detriment of Delhivery's bonafide. The plea is an abuse of process of law, the logistics provider said. 

The NCLT will now hear the plea filed by Delhivery on August 17. 

In its bankruptcy filing to NCLT, Go First said it owes Rs 6,521 crore ($797.38 million) in total to Bank of Baroda, IDBI Bank, and Deutsche Bank, which are its financial creditors.   

The airline has further said it has a total liability of about Rs 11,463 crore to banks, other creditors, vendors, and others.  

The NCLT on May 10 admitted the plea of Go First to initiate voluntary insolvency resolution proceedings and appointed Lal of Alvarez & Marsal as IRP of the airline. Later he was replaced by Shailendra Ajmera. 

Last week, the civil aviation regulator granted conditional approval for Go First to resume flights with 15 aircraft or 114 daily flights. 

DGCA said that it examined the resumption plan by Go First and the same has been accepted by them “subject to the outcomes of the writ petitions/applications” pending before the Delhi High Court and the (National Company Law Tribunal) NCLT.  

It said that certain conditions must be met for the flight operations to commence. 

Go First will be required to comply with all applicable regulatory requirements for holding an Air Operator Certificate at all times. It must ensure the continuation of the airworthiness or fitness of all its aircraft engaged in the operations.  

 The Directorate General of Civil Aviation (DGCA) stated that none of Go First’s aircraft will be deployed for operations without undertaking a satisfactory handling flight. Any change in the company that has any bearing on the resumption plan submitted by the RP must be notified to DGCA. 

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