 "Go First lessors can't carry out upkeep, DGCA tells Delhi High Court")
The Director General of Civil Aviation (DGCA) told the Delhi High Court on Monday that the lessors of insolvent Go First could not carry out maintenance work on the grounded aircraft.
According to the aviation regulator, based on their records, Go First is the only entity authorised to maintain the aircraft.
If there was insufficient clarity regarding the maintenance responsibility, it could hinder the processing of Go First's revival plan, posing a safety concern, the DGCA said.
Meanwhile, senior advocate Neeraj Kishan Kaul, appearing for the resolution professional (RP) of the airline, said the single-judge Bench's order of July 5 of the same court, which restrained the RP and the company's employees from altering or replacing any part of the leased aircraft, would cast a doubt on the airline company's revival plans.
An RP looks after the company after the insolvency process has started. On the other hand, senior advocate Ramji Srinivasan, appearing for the RP, presented the court with various measures undertaken to facilitate the company's revival.
He stated that Go First was prepared to resume operations by mid-July, subject to the DGCA nod, as it currently possesses 26 operational aircraft.
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Go First, which stopped flying from May 3, has suspended all operations till July 12.
Srinivasan urged the court to stay the single-judge Bench's order in the interest of the company's revival. He argued that the issue of whether or not a moratorium applies to these lessors is already pending before the court.
Under a moratorium period, which becomes effective after a company is admitted into insolvency, most or all legal proceedings against such a company are suspended.
The court has postponed the hearing on the case until July 11, when the lessors are expected to respond to the arguments presented by the RP and the DGCA.
Go First on Friday filed an appeal in the Delhi High Court challenging the order of the single-judge Bench of the same court. It had granted access to lessors of the insolvent airline and said the RP cannot access the leased aircraft.
Senior advocate Sandeep Sethi mentioned the matter for urgent listing before a division Bench of Chief Justice Satish Chandra Sharma and Justice Sanjeev Narula, which was taken up on Monday.
“The respondent, Go Air, its directors, employees, agents, officers or representatives, or the resolution professionals or their representatives as appointed by the NCLT are hereby restrained from removing, replacing, taking out any part or component, or any relevant operational or other manual records, documentation from any of the 30 aircraft except with prior written approval of the lessor of such aircraft,” Justice Tara Vitasta Ganju said on July 5.
The aircraft of the petitioner lessors are highly valuable and sophisticated equipment require maintenance for their preservation.
This has led to a tussle between the lessors and the airline on whether the aircraft can be flown by the insolvent airline, according to the revival plan.
The Delhi HC also allowed lessors of Go First to do inspection and maintenance relating to the aircraft in possession of the insolvent airline until the final disposal of the writ petition (of the lessors).
Several aircraft lessors, including Pembroke Aviation, Accipiter Investments Aircraft 2 Ltd, EOS Aviation, and SMBC Aviation, had filed a writ with the high court against DGCA and the central government. They sought directions to reclaim the planes leased to the cash-strapped airline.
The National Company Law Appellate Tribunal (NCLAT) on May 22 upheld the NCLT order of May 10 admitting Go First's plea for insolvency.
The principal Bench of the NCLT in Delhi had accepted Go First's voluntary plea to initiate the insolvency resolution process and had appointed an insolvency resolution professional to look after the airline.