Another layer has been added to the ongoing dispute between India’s grounded carrier, Go First and its lessors. The airline’s aircraft and engine lessors have argued that the protection given to it by insolvency proceedings does not apply to them as they had terminated their lease agreement with the airline before it filed for bankruptcy. But Go First has now challenged the timing of the termination in court.
A senior advocate, who appeared for the Resolution Professional (RP) of the troubled carrier Go First, recently argued at the National Company Law Tribunal (NCLT) that the lessors terminated the agreement with the airline only after it filed for bankruptcy. Go First’s engine lessors SMBC and Engine Lease Finance BV argued recently that the airline’s moratorium does not apply to them as they had canceled their lease agreement before the carrier went bankrupt.
But Go First says that it received communications regarding the termination only on May 2nd when it announced its decision to enter insolvency. The airline, therefore, questions the intention and timing of the lease termination by the lessors. The NCLT will consider the matter later this month.
Go First’ lessors have previously argued that the DGCA must follow the IDERA convention, under which aircraft must be de-registered and given back to the lessors if an airline fails to make payments.
13/09/2023 Gaurav Joshi/Simple Flying
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