Go First on last leg of extension from NCLT to complete insolvency process
Bankrupt airline Go First got a final 60-day extension from the National Company Law Tribunal (NCLT) on Wednesday to complete its corporate insolvency resolution process (CIRP). This extension will last till August 3.
The lenders of the airline include the Bank of Baroda, the Central Bank of India, and IDBI Bank. The NCLT had on April 8 extended the deadline by 60 days to June 3. Before this extension, the deadline was April 4. This is the fourth and final extension for the airline.
The tribunal told the airlines’ Committee of Creditors (CoC) and the resolution professional to adhere strictly to the deadline, saying that no further extension will be granted.CoC is a committee of lenders that takes decisions in the insolvency process of a corporate debtor (Go First in this case).
“We are not recording this in the order, but this is the final extension…Every time you seek extension …based on Essar judgment. Every time Essar Judgment will not help,” the tribunal said.
Under the Insolvency and Bankruptcy Code (IBC), the insolvency process should be completed within 180 days or the extended period of 90 days. It must be mandatorily completed within 330 days, including any extension and the time taken for legal proceedings.
After the exhaustion of this timeline, the liquidation proceedings start.
The extension sought by the RP was based on a Supreme Court judgment in the Essar Steel case, allowing extensions under exceptional circumstances.
The resolution professional’s lawyer told the tribunal on Wednesday that the extension was necessary keeping in mind the Delhi High Court judgment and the bids from potential investors.
This extension was to make room for the two remaining bids, one of which seeks a revision in light of the court’s judgment, while the other requires clarification.
Sharjah-based aviation company Sky One and domestic airline SpiceJet promoter Ajay Singh along with an entity called Busy Bee Airways, which is owned by Nishant Pitti — owner of online travel portal EaseMyTrip — were the two bidders for the airline.
The Delhi High Court on April 26 directed the civil aviation regulator to deregister planes leased to Go First within five working days and the Directorate General of Civil Aviation (DGCA) on May 1 deregistered all 54 aircraft leased to Go First. The airline thus lost all 54 of its aircraft.
Under the Insolvency and Bankruptcy Code (IBC), the insolvency process should be completed within 180 days or the extended period of 90 days. It must be mandatorily completed within 330 days, including any extension and the time taken for legal proceedings.
After the exhaustion of this timeline, the liquidation proceedings start.
The extension sought by the RP was based on a Supreme Court judgment in the Essar Steel case, allowing extensions under exceptional circumstances.
The resolution professional’s lawyer told the tribunal on Wednesday that the extension was necessary keeping in mind the Delhi High Court judgment and the bids from potential investors.
ALSO READ: Plane-less Go First’s situation ‘painful’; hopes for tailwind remain muted
First Published: Jun 12 2024 | 9:26 PM IST