NCLT liquidates Go First Airways

Bar and Bench reported that the National Company Law Tribunal ordered the liquidation of Go First Airways following a request by the airline’s Committee of Creditors.

The NCLT bench consisting of Mahendra Kahandelwal, Judicial Member, and Dr. Sanjeev Rajan, Technical Member, confirmed this decision by saying that “liquidation is ordered.”

Go First filed a voluntary petition for admission to Corporate Insolvency Resolution Process under Section 10 of Insolvency and Bankruptcy code (IBC) in May 2023. The NCLT accepted the plea on 10 May, appointing a Resolution Professional to manage the airline’s operations.

Lessors of the airline then appealed the decision to the National Company Law Appellate Tribunal, challenging the moratorium which prevented them from reclaiming their assets, despite having terminated leases before the proceedings started. The NCLAT affirmed the NCLT ruling on May 22nd, 2023. It also directed lessors that they should seek clarification about the moratorium.

The Directorate General of Civil Aviation initially refused to deregister the aircraft due to the moratorium. On October 4, 20,23, the Ministry of Corporate Affairs clarified the IBC Section 14(1) would not apply for transactions involving aircraft or related assets. The DGCA subsequently agreed, and Go First’s fleet had been deregistered by early May of 2024. Maintenance and export of aircraft were transferred to the lessors.

In September 2024, faced with a lack aircraft and no viable options for revival, the CoC decided to liquidate the airline. They filed the necessary application. The NCLT bench initially expressed concerns over the appointment of Shailendra Asjmera as liquidator, but Dinkar Venkatasubramanian became the official liquidator. Advocate Vishnu Sriram represented the CoC, and advocate Diwakar Mahaeshwari represented the Resolution Professional.