New Delhi (India), 10th May 2023: On May 10, the National Company Law Tribunal (NCLT) agreed to offer Go First protection against recovery by lessors and lenders under a moratorium.
A two-member panel, led by President Justice Ramalingam Sudhakar and L N Gupta, also appointed Abhliash Lal as interim resolution professional (IRP) to handle the insolvent corporation.
The NCLT said in its judgement, “we admit the plea of Go Airlines for insolvency proceedings.”
It has also placed the firm under moratorium protection and instructed the suspended board of directors to deposit 5 crores in order to cover immediate expenses.
Furthermore, the NCLT ruled that the company remain in operation and that no employees be laid off.
The NCLT reserved its decision on May 4 after hearing from the Wadia group-owned carrier and its aircraft lessors, who had challenged the petition for temporary relief.
Go First, which has been flying for almost 17 years, ceased operations on May 3 due to a financial crisis created by the grounding of more than half of its fleet due to a lack of Pratt & Whitney engines.
With 11,463 crore in liabilities, the airline has requested voluntary insolvency resolution proceedings as well as an interim suspension on its financial commitments.
The carrier’s lessors have objected to Go First’s request for an interim moratorium, claiming that it would have “harmful and serious consequences.” Furthermore, Go First is facing two further applications for insolvency proceedings.
Currently, the airline has extended the suspension of ticket sales until May 19.
