In a significant ruling, the National Company Law Tribunal (NCLT) at Delhi has rejected the plea of six aircraft leasing companies seeking to restrain Go First Airlines from using the aircraft leased to it. The bench, consisting of judicial member Mahendra Khandelwal and technical member Rahul Bhatnagar, ruled that the Directorate General of Civil Aviation (DGCA) had not deregistered the aircraft, thereby allowing them to be utilized by the Corporate Debtor to resume operations.
The ruling comes in the wake of the NCLT’s earlier decision on May 10, when it admitted Go First Airlines into insolvency proceedings upon the company’s application and directed the interim resolution professional to maintain the airline as a going concern. This directive reinforced the necessity of keeping the airline operational and paved the way for the continuation of its flight services.
In its order, the NCLT highlighted the importance of adhering to safety norms prescribed by the regulator. As long as the aircraft and engines remain registered, they can be put to use for commercial operations to ensure the smooth functioning of the airline within the defined safety standards.
The leasing companies, disappointed by the verdict, had also sought permission to conduct inspections of their respective aircraft and engines. However, the NCLT denied this request, stating that such inspections could hinder the resolution professional’s ability to protect and maintain the engines at the prescribed levels of efficiency and safety.
In light of the ruling, the responsibility of maintaining the property, engines, and aircraft at the highest level of efficiency now falls on the resolution professional. This ensures that Go First Airlines can continue its operations without compromising on the safety and effectiveness of its fleet.
The decision of the NCLT is seen as a positive step towards reviving Go First Airlines and providing relief to its stakeholders and employees. By allowing the use of the leased aircraft, the tribunal has paved the way for the airline to remain operational and navigate through the insolvency proceedings effectively.
Industry experts and aviation enthusiasts are closely monitoring the developments, as the ruling may have wider implications for other companies undergoing insolvency proceedings in the aviation sector. The case sets a precedent for balancing the interests of leasing companies and the resolution professional, safeguarding the airlines’ continuity while upholding the highest safety standards.
As Go First Airlines continues its journey as a going concern, all eyes are now on the resolution professional to efficiently manage the assets and steer the company toward a successful resolution in accordance with the insolvency laws of the country.
