BackGo First lessor allowed to check engines
This decision modified the NCLT’s 26 July order, which permitted Go First to use the leased aircraft, and noted that it does not approve the part of the NCLT order that restrained the lessor from inspecting the engines.
PremiumNew Delhi: The National Company Law Appellate Tribunal (NCLAT) on Friday allowed Go First airline’s engine lessor, Engine Lease Finance BV, to inspect their four engines used by the grounded airline.
This decision modified the NCLT’s 26 July order, which permitted Go First to use the leased aircraft, and noted that it does not approve the part of the NCLT order that restrained the lessor from inspecting the engines.
The NCLAT instructed the NCLT to promptly dispose of the matter. The court also directed the Resolution Professional (RP) to set a date for inspection within 10 days.
During the hearing, the lawyer representing the engine lessor, Anandh Venkatramani, said though the RP had informed them on 5 June that engines could be inspected he had not allowed the inspection till date.
Venkatramani emphasized the need to inspect the engines, each valued at $15 million, as they are sophisticated and crucial machinery. The engine lessor argued that they should be treated on par with aircraft lessors, who were allowed to inspect their parked aircraft by the Delhi High Court.
In response, senior lawyer Ramji Srinivasan, who appeared on behalf of RP, requested the court not to intervene in the NCLT proceedings, as the final hearing in the case is expected to be completed on 1 September. However, NCLAT rejected Go First’s request and stated that engine inspection must be allowed.
In July, NCLT permitted Go First to use ground-leased aircraft and resume operations, on the grounds that Directorate General of Civil Aviation (DGCA) hadn’t deregistered the aircraft, implying their availability for operations.
Meanwhile, the deregistration case filed by the aircraft lessors has been having day-to-day hearings in front of the at the Delhi High Court. The High Court’s division bench and the Supreme Court upheld the order allowing lessors to inspect the parked aircraft.
Mint earlier reported how despite approvals from the aviation regulator DGCA, Go First RP Shailendra Ajmera hasn’t managed to raise funds due to Delhi High Court order.
The airline has approached CoC for immediate infusion of ₹100 crore so that it can service its insurance and other statutory obligations.
Go First, earlier owned by Wadia Group, filed for insolvency attributing its financial troubles to Pratt and Whitney’s faulty engines. NCLT admitted the case on 10 May, also suspended the board, and imposed a moratorium on the airline’s financial obligations.
The moratorium led to several Go First aircraft lessors challenging NCLT’s admission of Go First’s insolvency in NCLAT, arguing that they should be allowed to reclaim their leased aircraft. But NCLAT refused to entertain their plea.
Later, lessors such as Pembroke Aircraft Leasing 11 Ltd, SMBC Aviation Capital Ltd, Accipiter Investments Aircraft 2 Ltd, EOS Aviation 12 (Ireland) Ltd, SFV Aircraft Holdings IRE 9 DAC Ltd, ACG Aircraft Leasing Ireland Ltd, and DAE SY 22 13 Ireland Designated Activity Company, approach the Delhi High Court and sought deregistration of the aircraft leased to Go First.
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