Go First's 54 Leased Planes Deregistered Following Delhi High Court Order

The Directorate General of Civil Aviation (DGCA) has deregistered all 54 planes leased by the bankrupt Indian budget carrier Go First, following a Delhi High Court order. Go First stopped flying in May 2023 and is undergoing an insolvency resolution process.

The Delhi High Court had directed the DGCA to process the applications filed by the lessors for deregistration of the aircraft within five working days. The deregistration process has been completed, with some of the notices being uploaded on the DGCA website.

The deregistration was done under the Cape Town Convention, which allows lessors to exercise the Irrevocable De-registration and Export Request Authorisation (IDERA) option when an airline defaults on a leased aircraft.

Go First had blamed its financial troubles on "faulty" engines supplied by Pratt & Whitney, leading to the grounding of 28 of its 56 planes. The airline reportedly owes its creditors over Rs 6,200 crore.

The National Company Law Tribunal (NCLT) has granted Go First a third 60-day extension to complete its insolvency process. Two bidders, Sharjah-based Sky One and SpiceJet promoter Ajay Singh along with Busy Bee Airways, are interested in acquiring the airline.

Why this matters: The deregistration of Go First's leased planes is a significant development in the airline's ongoing insolvency case, impacting its operations and ability to continue services. The move paves the way for the airline's potential liquidation, as lenders consider their options.

The Delhi High Court's ruling overturned the DGCA's previous communication deferring the lessors' deregistration applications due to Go First's moratorium period. The court also restrained the resolution professional and the airline's directors from moving or taking away the planes, spare parts, documents, records, and other material. The DGCA, Airports Authority of India (AAI), and their authorized representatives were directed to aid and assist the petitioner lessors and grant them access to the airports to export the aircraft as per applicable rules and laws.

Key Takeaways

• DGCA deregistered all 54 Go First planes after Delhi HC order to process lessors' requests.
• Deregistration done under Cape Town Convention, allowing lessors to reclaim planes on airline default.
• Go First blamed engine issues for grounding 28 of 56 planes, owes creditors over Rs 6,200 crore.
• NCLT granted Go First 3rd 60-day extension for insolvency process, with 2 bidders interested.
• Deregistration paves way for Go First's potential liquidation as lenders consider options.