Go First moves SC against HC order granting lessors' access to aircraft

lessors informed high court that future aircraft leasing would be jeopardized if DGCA fails to deregister aircraft whose leases they have terminated

Go First on Thursday challenged the division Bench order of the Delhi High Court (HC) in the Supreme Court (SC). The disputed order upholds a single judge's ruling that permits the crisis-hit airline's lessors to inspect the aircraft.

Ramji Srinivasan, the senior advocate representing the Resolution Professional (RP) of the airline, informed the single-judge Bench of Justice Tara Vitasta Ganju that the matter is likely to appear before the apex court either on Friday or Monday.

On Thursday, the lessors informed HC that future aircraft leasing would be jeopardised if the Directorate General of Civil Aviation (DGCA) fails to de-register aircraft whose leases have been terminated.

Senior Advocate Mukul Rohatgi, representing one of the lessors, said the involuntary retention of their aircraft reflects negatively on the Indian aviation sector.

He also noted that while the civil aviation regulator has not out rightly rejected their request for deregistration, it has been placed in abeyance due to the ongoing moratorium.

A moratorium is a period during which most, or certain, legal actions against a debtor are suspended. It commences once a company enters insolvency or bankruptcy proceedings.

The lessors argued that, under the Irrevocable Deregistration and Export Request Authorisations (IDERA), the DGCA is obligated to deregister the aircraft upon their request.

They previously told the court that, according to Rule 30(7) of the Aircraft Rules, 1937, the Central government could cancel the registration of an aircraft in India, to which the Cape Town Convention applied, without needing the aircraft holder's permission, if an IDERA holder (lessors) applied for lease cancellation.

The lessors maintained that the DGCA should uphold the IDERA convention, regardless of whether a company is under a moratorium.

They argued that international conventions should supersede the national law in the present case.

The case is scheduled for hearing on Friday.

The National Company Law Tribunal will also hear the primary Go First insolvency case on the same day.

Go First ceased operations on May 3, and its request for voluntary insolvency was approved by the NCLT on May 10, initiating the moratorium period.