Go First on Friday announced that it will extend flight cancellations further till May 23 due to “operational reasons”. The Wadia-Group-owned budget carrier had earlier suspended all its flights till May 19. This comes after the National Company Law Tribunal (NCLT) admitted the airline’s voluntary insolvency resolution petition and appointed an Interim Resolution Professional (IRP) to manage the carrier on May 10.
The airline in a notification said, “Due to operational reasons, Go First flights until 23rd May 2023 are cancelled. We apologise for the inconvenience caused and request customers to visit https://t.co/qRNQ4oQROr for more information.”
“We acknowledge the flight cancellations might have disrupted your travel plans and we are committed to providing all the assistance we can…. As you are aware, the company has filed an application for immediate resolution and revival of operations We will be able to resume bookings shortly. Thank you for your patience,” Go First added, requesting customers to be patient.
Due to operational reasons, Go First flights until 23rd May 2023 are cancelled. We apologise for the inconvenience caused and request customers to visit https://t.co/qRNQ4oQROr for more info. For any queries or concerns, please feel free to contact us. pic.twitter.com/si1c5e9hz4
— GO FIRST (@GoFirstairways) May 12, 2023
The airline also promised that a full refund of the ticket prices would be made to the original mode of payment soon.
The crisis-hit airline was first halted on May 2 and filed for voluntary insolvency citing “faulty” Pratt & Whitney engines that grounded about half its 54 Airbus A320neos.
On Wednesday, the NCLT admitted Go First’s voluntary plea to initiate insolvency resolution proceedings. A two-member bench comprising President Justice Ramalingam Sudhakar and L N Gupta appointed Abhliash Lal as interim resolution professional (IRP) to run the debt-ridden firm. Besides, there is a moratorium on the assets and liabilities, which also means that lessors cannot take back the planes leased to the crisis-hit Go First during the process.
Also Read: Go First Insolvency: SMBC Aviation Capital Moves NCLAT Challenging NCLT Order
Meanwhile, aircraft lessor SMBC Capital has told appellate tribunal NCLAT that the Indian aviation sector is being seen as a risky jurisdiction in light of the fate of Kingfisher and Jet Airways, as it vehemently opposed cash-strapped Go First’s insolvency resolution proceedings.
Describing Go First’s petition as “malicious and a smokescreen”, SMBC Capital also said that voluntary insolvency proceedings cannot be an escape route by promoters who have run the corporate debtor/ corporate applicant into the ground to escape the consequences of such defaults.
The National Company Law Tribunal (NCLT) on May 10 admitted the airline’s voluntary insolvency resolution petition and appointed an Interim Resolution Professional (IRP) to manage the carrier. Besides, there is a moratorium on the assets and liabilities, which also means that lessors cannot take back the planes leased to the crisis-hit Go First during the process.
Aircraft lessor SMBC Aviation Capital Ltd on Wednesday moved appellate tribunal NCLAT against the order passed by the NCLT earlier in the day allowing Go First’s voluntary plea to initiate insolvency proceedings, the PTI reported. According to the report, SMBC Aviation Capital, formerly RBS Aviation Capital, is one of the world’s largest aircraft leasing companies.
According to PTI, Go First on Friday argued before the National Company Law Appellate Tribunal (NCLAT) that termination of leases for aircraft by their lessors would not have any consequence as the moratorium has been imposed under insolvency resolution proceedings, Wadia group air carrier
While aircraft lessors on the other side raised doubts over the revival of Go First through the corporate insolvency resolution process (CIRP), citing the amount required to make it fly again.
Senior advocate Arun Kathpalia representing SMBC Aviation said the average lease rent of per aircraft is around $2 lakh for a month and with more than 50 aircraft the monthly bill would be $10 million.
“Cost of this misadventure is enormous,” he said.
For SMBC Aviation only, Go First has to pay $4.2 million per month, which includes maintenance and lease.
SMBC Aviation Capital Ltd submitted that they have legal possession of their aircraft before the insolvency process started and as of today, Go First has no right for possession of those planes.
Two other lessors, G Y Aviation and SFV Aircraft Holdings, which had moved appellate tribunal on Thursday, also argued their case and opposed the CIRP against Go First.
All three lessors own around 21 aircraft, which were leased to crisis-hit Go First. The matter remained part-heard and the appellate tribunal would continue its hearing on Monday.