Go First will retain its aircraft after the National Company Law Appellate Tribunal (NCLAT) on Monday dismissed appeals filed by the cash-strapped airline’s lessors.
The lessors had appealed against National Company Law Tribunal’s (NCLT) decision on May 10 to admit the airline's insolvency plea and allow it a moratorium against coercive action. NCLAT upheld that order, but lessors may still file another application of malicious intent and fraud against the airline in NCLT.
If the NCLT accepts this application, the moratorium against the airline can be lifted. Lessors also have the option of appealing against the NCLAT decision in the Supreme Court.
Maninder Singh, senior advocate appearing for Go First, told NCLAT in the last hearing that an impression was being created that there was something "wrong and malicious" about the airline seeking voluntary insolvency.
The NCLAT will later hear SMBC Aviation Capital, SFV Aircraft Holdings, GY Aviation Lease, and Engine Leasing Finance appeal against the NCLT order.
SMBC Aviation Capital had told the tribunal that the insolvency application by Go Air is "malicious" and a "smokescreen". They also said that the aircraft in the possession of Go First are their assets, which they are not able to access.
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Meanwhile, SFV Aircraft Holdings had said, “They may tinker with our planes, may use parts from my planes to service other planes.”
The insolvency resolution professional of Go First had told NCLAT that if the airline was allowed to operate, around 80 engines from Pratt & Whitney would “change the fortunes of the company”.
The airline had told the NCLT it had won an arbitral award in Singapore against Pratt & Whitney (P&W), directing P&W to supply 10 serviceable engines by April 27 this year and 10 serviceable engines each month till December 2023.
SMBC Aviation Capital told the court in a submission on May 11 that the Indian aviation sector is being seen as a risky jurisdiction in light of the fate of Kingfisher and Jet Airways. "Due to such difficulties, lessors and international aircraft owners see India as a risky jurisdiction for aircraft leasing. Therefore, Indian operators have to pay a premium to take aircraft on lease. Thus, the admission of the petition (of Go First) will further shake the confidence of the International Aviation Industry," SMBC told the appellate tribunal.
