 "Go First insolvency resolution gets a 60-day extension from NCLT")
The National Company Law Tribunal (NCLT) on Monday gave another 60-day extension to Go First to complete its insolvency process.
The recent extension by the NCLT was based on a Supreme Court judgment in the Essar Steel case, allowing extensions under exceptional circumstances.
This is the third extension sought by Go First. The NCLT had, on November 23, 2023, extended the insolvency process of the grounded airline by 90 days.
The extension started on November 6, 2023, and ended on February 4, 2024. Then, Go First had sought an extension from February 4 to April 4, 2024.
According to Section 12(1) of the Insolvency and Bankruptcy Code (IBC), the insolvency process should be completed within 180 days. Or, within the extended period of 90 days and mandatorily within 330 days, including any extension and the time taken for legal proceedings.
The resolution professional of the airline on Monday justified the extension, citing the Essar Steel judgment. It said that the resolution plan was nearing conclusion. The lessors opposed the extension. The NCLT sided with the airline and granted the extension.
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Go First filed for voluntary insolvency on May 2, 2023, under Section 10 of the IBC. And on May 10, the NCLT admitted Go First’s insolvency plea.
Go First’s aircraft lessors had then filed an appeal against the NCLT order in the National Company Law Appellate Tribunal (NCLAT). They said their aircraft should be returned to them as they had terminated the leases before the moratorium kicked in.
The extension comes as a relief to Go First, which has been embroiled in a legal battle with its lessors since May last year over the control of its aircraft.
However, the Ministry of Corporate Affairs issued a notification on October 3 last year, exempting arrangements relating to aircraft, aircraft engines, airframes, and helicopters from the moratorium under Section 14(1) of the IBC, 2016.
The Director General of Civil Aviation (DGCA) then filed an affidavit in the Delhi High Court. It said the notification exempting aviation leases from moratorium under the IBC should apply to pending cases as well.
Sharjah-based aviation company Sky One and SpiceJet promoter Ajay Singh, along with an entity called Busy Bee Airways, owned by Nishant Pitti of EaseMyTrip, are the two bidders for the airline.