NCLT reserves order on Go First’s plea seeking interim moratorium

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New Delhi, May 4

The National Company Law Tribunal (NCLT) on Thursday reserved its order on crisis-hit airline Go First’s plea seeking initiation of voluntary insolvency resolution proceedings and an interim moratorium on its financial obligations.

Meanwhile, the low-cost carrier has cancelled all its flights till May 9, extending the suspension of operations by four days beyond the initial three-day period. The budget carrier is also not taking new bookings till May 15.

Go First said it was cancelling the flights till May 9 due to operational reasons, adding that a full refund will be issued to the affected passengers. The Directorate General of Civil Aviation (DGCA) has asked the airline to process refunds to passengers as per timelines stipulated in the regulations.

Aircraft lessors oppose plea for insolvency

• The DGCA has asked the airline to process refunds to passengers as per timelines stipulated in the regulations
• Aircraft lessors vehemently opposed Go First’s urgent plea for voluntary insolvency resolution proceedings and a moratorium on the financial obligations
• This would in turn impact the employment of 7,000 direct and 10,000 indirect employees and debt repayment

The NCLT coram of president Justice Ramalingam Sudhakar and technical member LN Gupta heard the airline company at length today on its prayer.

Counsels representing Go First contended that due to the increased grounding of aircraft, the company started making losses.

The counsels said the airline was seeking an imposition of interim moratorium to prevent lessors from taking possession of its fleet. The tribunal said there was no provision to grant interim moratorium under IBC (Insolvency and Bankruptcy Code). After hearing the company for over three hours, the Bench reserved the plea for orders.