SC refuses to entertain Go First's plea against HC order permitting lessors to inspect, maintain leased aircraft

The Supreme Court on Monday refused to entertain a petition by the interim resolution professional (IRP) of crisis-hit Go First airline against the Delhi High Court order permitting lessors to inspect their aircraft and carry out maintenance.

A bench of Chief Justice D Y Chandrachud and Justices J B Pardiwala and Manoj Misra said since the Delhi High Court is seized of the matter and hearing it on a day-to-day basis, it was not going to entertain the plea at this stage.

Senior advocate Shyam Divan, appearing for the IRP, said efforts to revive the company and keep it afloat as a going concern will be hit if the lessors are permitted to cancel the lease deed with regard to aircraft and engines.

The senior lawyer raised the issue of jurisdictional competence of the high court in the matter.

'We will not entertain. Since the proceedings are pending before the Delhi High Court where petitions are being argued on a day-to-day basis, we are not entertaining this at the present stage. Let the jurisdictional issues also be addressed before the single judge (of the high court),” the bench said. The IRP has challenged the order of a division bench of the high court which had upheld the verdict of the single-judge bench in the case.

On July 5, the single-judge bench of the high court had allowed Go First’s lessors to inspect their aircraft at least twice a month and carry out maintenance.

It had said there can be no denial of the fact that the aircraft of the petitioner lessors are highly valuable and sophisticated equipment and require maintenance for their preservation.

It had also restrained Go First and its representatives, and the Interim Resolution Professional (IRP) appointed by the NCLT, from removing, replacing or taking out any part or components, or records of the 30 aircraft except with the prior written approval of the lessor of the particular airplane.

The high court had passed the interim order on multiple applications filed by the lessors to alleviate any further losses.

The interim applications were filed in the main petitions by lessors seeking deregistration of their planes by aviation regulator DGCA so they could take them back from the airline.

The high court had asked the Directorate General of Civil Aviation (DGCA) to permit the lessors, their employees and agents to access the airport, where their aircraft are currently parked, and to inspect them within three days.

The high court had asked the respondents – Directorate General of Civil Aviation (DGCA) and IRP -- to file their responses to the petitions of the lessors within three weeks, and listed the matter for further hearing on August 3.

Earlier, The NCLT-appointed IRP, tasked with managing Go First, had told the high court that returning aircraft to the lessors will render the airline, which has 7,000 employees to look after, 'dead'.

On May 10, the National Company Law Tribunal (NCLT) had admitted the airline’s voluntary insolvency resolution petition and appointed Abhilash Lal as the IRP to manage the carrier.

With a moratorium in force on financial obligations and transfer of assets of Go First in the wake of the insolvency resolution proceedings, the lessors are unable to deregister and take back the aircraft leased to the carrier.

The lessors had earlier told the high court that denial of deregistration by the DGCA was “illegitimate”.

The lessors who have approached the high court are: Accipiter Investments Aircraft 2 Limited, EOS Aviation 12 (Ireland) Limited, Pembroke Aircraft Leasing 11 Limited, SMBC Aviation Capital Limited, SFV Aircraft Holdings IRE 9 DAC Ltd, ACG Aircraft Leasing Ireland Ltd and DAE SY 22 13 Ireland Designated Activity Company.

The NCLT had on May 10 allowed the voluntary insolvency resolution plea of Go First. On May 22, the NCLAT upheld the order of the Delhi-based principal bench of NCLT, which had admitted the plea of Go First to initiate voluntary insolvency resolution proceedings, and appointed the IRP to suspend the company's board.

Several lessors then approached aviation regulator DGCA for deregistration and repossession of 45 planes they had leased to the carrier.

Go First stopped flying on May 3.