The Delhi High Court has ruled that lessors of aircraft leased to grounded Indian airline Go First can take care of maintenance of their aircraft.
This news comes at the time when the Indian aviation regulator, the Directorate General of India (DGCA) is conducting an audit at the airline’s bases at Mumbai and Delhi, before allowing it to re-start operations.
The aircraft lessors had approached the Delhi High Court following the order by NCLT which barred them from deregistering their aircraft leased to Go First.
Delhi High Court ruling
The High Court has now passed an order allowing the lessors to undertake maintenance on the aircraft engines twice a month until the writ petition filed is resolved.
The order also prohibits the airline from replacing or removing any component or spares or any relevant operational/manual documents from the aircraft without prior approval from the lessor.
The Court agreed that NCLT does not have the power of judicial review over administrative action.
The judgement said “The 30 aircrafts are assets owned by the lessor”, which were “previously under a contractual agreement” with Go First. Thus, “prima facie, the IRP (GO First resolution professional) is not required to take control of the same under the provisions of the IBC.”
The “balance of convenience” is also in favor of the aircraft owners who “are suffering irreparable losses as the value of these Aircrafts are diminishing on a daily basis.”
Aircraft are “extremely valuable and require regular maintenance for their preservation.” Therefore, “aircraft owners, their employees, agents, officers and/or representatives shall be permitted by the Go First/DGCA and appropriate Airport Authorities to access Airport(s) where the 30 Aircrafts are parked to inspect their respective Aircrafts, within the next 3 days.”
“Go First, its directors, employees, and or representatives are hereby restrained from removing, replacing, taking out any accessories, or spares, etc. or any relevant operational or other Manuals/records with prior written approval of the Lessor of such Aircraft”.
International conventions such as Cape Town must be followed; disputes over “validity of termination of lease are not relevant for purpose of deregistration and contention that public interest will be impinged if deregistration granted is not a valid ground for refusal””.
In this hearing, Go First and the DGCA had informed the High court that they are unable to de-register the aircraft following the NCLT order.
Things were going smoothly for the airline before this, as the engine manufacturer Pratt & Whitney had promised delivery of new engines on priority and servicing of the current engines.
The airline was also considering using CFM engines for some of its aircraft and resumption of operations would thus suffer minimum disruption due to the engine issue.
This order by the Delhi High Court might raise some issue to the airline and only in coming days we will get to know the fate of the airline.