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Go First in Delhi High Court: DGCA’s opinions are unfounded

Go First denied on Friday that the government’s decree exempting leased aircraft from the Insolvency and Bankruptcy (IBC) procedure would apply retroactively, as stated by the Directorate General of Civil Aviation (DGCA).

Go First’s attorney stated in the Delhi High Court that the IBC does not outline exemptions for periods of moratorium or contain any retroactive provisions. The majority of statutory provisions, according to the resolution professional’s attorney, are often proactive. As a result, a DGCA clarification that does not specifically reference something in the law is not relevant.


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As part of a writ petition proceeding, the DGCA made it clear on Wednesday that it believes the most recent modifications to the rules regarding the recovery of aircraft during insolvency, which were approved by the Ministry of Corporate Affairs on October 3, are retroactive.

The matter was postponed and will be heard again on November 10 by the court.

Lessors asked the court to deregister the aircraft right away during the hearing, arguing that the DGCA’s explanation appeared to render the case moot.

They begged for deregistration on the grounds of the moratorium, arguing that their writ petition is directed against the DGCA rather than the RP, which the DGCA clarified. They implored the court to make a decision in their favor right away. Senior attorney Neeraj Kishan Kaul retorted, opposing this abrupt request on behalf of the RP.

He contended that the lessors had been heard by the court for the previous two months and now they were asking for a quick ruling without considering the RP’s position. Kaul restated the RP’s stance, saying that the National Company Law Tribunal (NCLT) is the proper forum to determine whether the moratorium is applicable and that the Delhi High Court lacks the competence to make such a determination. According to Kaul, the lessors are trying to get around the Corporate Insolvency Resolution Process (CIRP) by approaching several venues.

Reviving the airline is the goal of the insolvency procedures, according to RP. They emphasized that the airline’s aircraft are essential assets, and taking them away would cause the business to fail.

In a statement dated October 3, the government stated that transactions, arrangements, or agreements pertaining to airplanes, aircraft engines, airframes, and helicopters will be exempt from the requirements of Section 14(1) of the IBC, which imposes a moratorium upon the admission of an insolvency plea. 

The lessors of Go First are taking advantage of this modification in tribunals and courts to reclaim their assets from the airline. However, delays could happen because of alterations to the NCLT bench’s makeup that is handling the case.

Source- Livemint

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