NCLT admits Go First bankruptcy petition

The airline plans to resume some of its flights from 24 May

- Anu Sharma, Priyanka Gawande

A Delhi bankruptcy court admitted Go First's request for insolvency on Wednesday, marking the beginning of a search for a buyer for the budget airline.

The National Company Law Tribunal’s (NCLT’s) acceptance of Go First’s insolvency plea triggers a moratorium on the airline’s assets and liabilities. It bars any legal proceedings related to asset recovery, sale, or transfer of assets, as well as the termination of crucial contracts by vendors.

“Keeping in mind the urgency of the case, to protect and maximize the value of the assets in line with the objectives of IBC (Insolvency and Bankruptcy Code), employment and the larger public interest involved, the petition has been admitted," a bench led by Justices Ramalingam Sudhakar and L.N. Gupta said.

Go First may resume some flights from 24 May as the airline plans to keep its air operator certificate active, two people aware of the development said. The airline is yet to submit a detailed plan of its flight operations to the civil aviation regulator Directorate General of Civil Aviation (DGCA).

Notably, the court’s order also precludes lessors from reclaiming aircraft during the moratorium period. Aircraft lessors approached the DGCA, to deregister over 40 aircraft of Go First on 4 May onwards, after the airline filed the bankruptcy petition.

Under Irrevocable De-registration and Export Request Authorisations (IDERA), the civil aviation regulator is required to deregister aircraft within five days in case of default of lease rentals.