Active Stocks
Fri Apr 19 2024 15:56:00
  1. Tata Steel share price
  2. 162.10 1.31%
  1. Tata Motors share price
  2. 963.20 -0.84%
  1. NTPC share price
  2. 350.90 -0.14%
  1. ITC share price
  2. 424.80 1.40%
  1. Power Grid Corporation Of India share price
  2. 281.70 0.54%
Business News/ News / Lessors seek contempt notice against Go First's RP for aircraft maintenance failures
BackBack

Lessors seek contempt notice against Go First's RP for aircraft maintenance failures

The court did not issue a notice and instead provided time for the RP to come up with instructions on the next date regarding whether the responsibility for maintenance should be given back to the lessors or to a third party.

Two bids have been submitted for the revival of Go First's operations. (HT_PRINT)Premium
Two bids have been submitted for the revival of Go First's operations. (HT_PRINT)

Several lessors of the bankrupt airline Go First informed the Delhi high court on Friday that airline's resolution professional (RP) Shailendra Ajmera had failed to conduct any maintenance on their aircraft and wilfully defied court orders regarding maintenance.

The lessors sought the court to issue a contempt notice against the RP. However, the court did not issue a notice and instead provided time for the RP's counsel to come up with instructions on the next date regarding whether the responsibility for aircraft maintenance should be given back to the lessors or to a third party. The hearing was deferred to next week.

The plea of contempt against the RP was filed by lessor DAE (SY22) 13 Ireland Designated Activity Company in November last year. 

It alleged non-compliance with a previous court order instructing the RP to maintain the aircraft and provide maintenance records to the lessors. Ten out of fourteen lessors in the case supported the plea for contempt proceedings against the RP.

In response, RP informed the court that they had partially complied with the court order by providing maintenance documents to all lessors and initiating steps for maintenance. RP mentioned issuing a work order and appointment of Continuing Airworthiness Management Organization (CAMO) by the Directorate General of Civil Aviation (DGCA) for aircraft maintenance. 

Additionally, RP noted meetings with lessors in Mumbai where an agreement was reached to appoint a third party for maintenance.

The RP further stated that the maintenance delays occurred due to the resignation of the previous CAMO and a lack of manpower, emphasizing that the delay was not intentional but rather due to unforeseen circumstances, as the airline has not been operational since its bankruptcy. 

Despite the RP's response, the lessors insist on contempt proceedings, arguing that the RP had knowingly taken responsibility for maintenance despite lacking resources and manpower, thereby defying court orders.

The high court had on 5 July 2023 allowed the RP to take responsibility for maintaining Go First’s aircraft but allowed lessors the right to inspect—an order later upheld by a division bench of the high court as well as the Supreme Court.

The court then, on 12 October, directed Go First's RP to provide all maintenance and technical records, along with other key aircraft-related documents to the lessors.

Go First declared bankruptcy in May 2023 due to engine failures from Pratt & Whitney. Legal and administrative hurdles, including disputes with lessors and changes in the National Company Law Tribunal (NCLT) benches, have prevented the airline from resuming operations.

Recently, the NCLT granted a 60-day extension for the moratorium until 4 April, allowing the airline more time to finalize its corporate insolvency resolution process within the total 330 days permitted under the Insolvency and Bankruptcy Code (IBC).

Two bids have been submitted for the revival of Go First's operations. The first bid, jointly submitted by SpiceJet chairman and managing director Ajay Singh and Busy Bee Aviation Pvt. Ltd. The second bid comes from Sharjah-based aviation company Sky One which specializes in a wide array of aviation services.

Unlock a world of Benefits! From insightful newsletters to real-time stock tracking, breaking news and a personalized newsfeed – it's all here, just a click away! Login Now!

ABOUT THE AUTHOR
Krishna Yadav
Krishna, a lawyer turned journalist, is a key member of Mint's corporate team. He covers major legal battles in Delhi's courtrooms, with a focus on finance, markets, and policy. Additionally, he crafts easy-to-understand explainers for complex stories and holds a PG Diploma from the renowned Asian College of Journalism.
Catch all the Business News, Market News, Breaking News Events and Latest News Updates on Live Mint. Download The Mint News App to get Daily Market Updates.
More Less
Published: 01 Mar 2024, 07:05 PM IST
Next Story footLogo
Recommended For You
Switch to the Mint app for fast and personalized news - Get App