NCLT orders liquidation of Go First Airways

The National Company Law Tribunal (NCLT) ordered the liquidation of Go First Airways after a request from the airline's Committee of Creditors (CoC), Bar and bench reported on Monday.

The NCLT bench, consisting of Judicial Member Mahendra Khandelwal and Technical Member Dr. Sanjeev Ranjan, confirmed the decision, saying, “Liquidation is ordered.”

Go First filed a voluntary plea for admission to the Corporate Insolvency Resolution Process (CIRP) under Section 10 of the Insolvency and Bankruptcy Code (IBC) on May 2, 2023. The NCLT admitted the plea on May 10, appointing a Resolution Professional (RP) to manage the airline's operations. Following this, the airline's lessors appealed to the National Company Law Appellate Tribunal (NCLAT), challenging the moratorium that prevented them from reclaiming assets, despite the termination of leases before the proceedings began. The NCLAT upheld the NCLT’s ruling on May 22, 2023, and directed lessors to seek clarification on the moratorium.

Subsequently, the lessors approached the Delhi High Court to deregister the aircraft, but the Directorate General of Civil Aviation (DGCA) initially resisted due to the moratorium. However, on October 4, 2023, the Ministry of Corporate Affairs clarified that Section 14(1) of the IBC would not apply to transactions involving aircraft and related assets. The DGCA later agreed, and by early May 2024, Go First’s fleet was deregistered, with the maintenance and export of the aircraft transferred to the lessors.

By September 2024, facing a lack of aircraft and no viable revival options, the CoC chose to liquidate the airline and filed the necessary application. The NCLT bench had previously expressed concerns about the appointment of Shailendra Ajmera as the liquidator but later approved Dinkar Venkatasubramanian as the official liquidator. The CoC was represented by advocate Vishnu Sriram, and the Resolution Professional by advocate Diwakar Maheshwari.

(With inputs from Bar and Bench)