New Delhi: The National Company Law Tribunal (NCLT) Monday ordered the liquidation of Go First, the budget carrier that stopped flying nearly two years ago amid financial woes.
In May 2023, the airline filed for a voluntary insolvency resolution process.
The tribunal, in a 15-page order, said it is ordering the liquidation of the corporate debtor Go Airlines (India) Ltd.
On Monday, the NCLT said the Committee of Creditors (CoC) in the legislative scheme is empowered to take the decision to liquidate the corporate debtor, at any time after its constitution and before confirmation of the resolution plan.
“It is well settled that the decision taken by the CoC for liquidation in commercial wisdom of the CoC should not be interfered with by the Adjudicating Authority. Further, the resolution for liquidation of the corporate debtor was approved by the CoC with 100 per cent voting. Therefore, this Adjudicating Authority sees no merit in interfering with the commercial wisdom of the CoC,” it noted.
The order comes a little over two months after the Supreme Court, November 7, 2024, ordered the liquidation of the once-storied airline Jet Airways, which had stopped flying in April 2019.
Go Air, which was rebranded as Go First, flew for more than 17 years before suspending operations May 3, 2023.
Dinkar Tiruvannadapuram Venkatasubramanian has been appointed as the liquidator.
The liquidator has been asked to follow up and continue to investigate the financial affairs of the corporate debtor. “The liquidator shall also follow up the pending applications for their disposal during the process of liquidation, including the initiation of steps for recovery of dues of the corporate debtor as per law,” according to the order.
Further, the liquidator should submit a preliminary report to the tribunal within 75 days from the date of commencement of the liquidation.
During the insolvency resolution process, there were at least two bidders in the fray — Busy Bee Airways, along with SpiceJet chief Ajay Singh, and Sharjah-based aviation entity Sky One.
Travel portal EaseMyTrip’s Co-Founder Nishant Pitti was the majority shareholder in Busy Bee Airways.
In between, aviation regulator DGCA deregistered the 54 aircraft of Go First.
The resolution process did not take off, and now, the tribunal has ordered the liquidation of the airline.
The cash-starved airline reported a loss in the range of Rs 1,800 crore, including an Rs 800 crore notional loss due to accounting standards in the financial year ended March 2023.
It started domestic operations in 2005-06 with the first flight from Mumbai to Ahmedabad, and then in 2018-19, launched international operations.
Since commencing operations, Go First had placed two orders for 72 A320 neo planes each with Airbus, one in 2011-12 and another in 2016-17.
On May 13, 2021, when the coronavirus pandemic headwinds were blowing strong, the airline announced rebranding itself as ‘Go First’ with a focus on an ultra-low-cost business model.
PTI
