The National Company Law Tribunal has ordered the liquidation of the remaining assets of budget carrier Go First (formerly known as GoAir).
On Monday, a bench of NCLT gave its nod to an application filed by the airline’s financial creditors to liquidate the remaining assets of the airline after attempts to revive Go First failed.
Consequently, the Committee of Creditors (CoC), comprising financial lenders including Bank of Baroda and Central Bank of India, amongst others, had filed an application with the NCLT to liquidate the remaining assets of the airline.
Earlier, attempts were made by the airline’s CoC to revive operations by bringing in a new investor. Two proposals were even received from SpiceJet promoter Ajay Singh along with Busy Bee Airways and UAE-based Sky One Aviation.
However, interest in the airline dwindled after lessors were allowed to take back their aircraft from the airline. Go First had a fleet of 54 aircraft.
At present, Go First’s assets are estimated to include a ₹3,000 crore (approximate) worth of land parcel, its headquarter, and a training centre, while its overall liabilities, including those to lenders, lessors, travel agents, and passengers, are estimated at around ₹11,000 crore.
Besides, the NCLT relieved the resolution professional Shailendra Ajmera, and appointed Dinkar Tiruvannadapuram Venkatasubramanian as the liquidator.
The NCLT said that its order of moratorium passed under Section 14 of the Insolvency and Bankruptcy Code, 2016 (IBC) shall cease to exist and a fresh moratorium under Section 33(5) of IBC shall commence.
“It is well settled that a decision taken by the CoC for liquidation in commercial wisdom of the CoC should not be interfered with by the adjudicating authority. Further, the resolution for liquidation of the corporate debtor was approved by CoC with 100 per cent voting,” the NCLT order copy read.
“Therefore, this adjudicating authority sees no merit in interfering with the commercial wisdom of the CoC.”
On the other hand, the NCLT, refused to pass an order and intervene on the airline’s request to allow foreign funding to support its arbitration case against the Pratt & Whitney in Singapore.
Go First had stopped flying on May 3, 2023, and its plea for voluntary insolvency resolution proceedings was admitted by the NCLT on May 10, 2023.
The airline shuttered operations due to alleged financial woes caused by persisting issues with Pratt & Whitney engines that had resulted in the grounding of its aircraft.
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