Court approves deregistration of Go First planes, clearing path for repossession

Deregistration for Go First Lessors: The Delhi High Court has approved the deregistration of aircraft by lessors of Go First, clearing the path for them to pursue repossession after the airline declared bankruptcy almost a year ago.
Go First lessors had petitioned the Delhi High Court on Thursday for the deregistration of their aircraft following a recent notification by the Ministry of Corporate Affairs (MCA). The notification exempted aircraft, engines, and airframes from a moratorium under the Insolvency and Bankruptcy Code, 2016.

Lessors stressed that the Directorate General of Civil Aviation (DGCA) had the primary responsibility to either confirm their position in light of this development or adjust it accordingly. They argued that the resolution professional (RP) or the committee of creditors (CoC) played a secondary role, with the DGCA's decision being paramount.

In response, Advocate Anjana Gosain, representing the DGCA, assured the court of their compliance with its decision, stating that as a government entity, they must act responsibly. Justice Tara Vitasta Ganju initially suggested that the DGCA should deregister the aircraft but later allowed the regulator to present its stance on the matter.

Meanwhile, Neeraj Kishan Kaul, counsel for the RP, requested time from the court to review the notification and consult the CoC, contesting the lessors' assertion regarding the CoC's role.
The court granted both the RP and the DGCA an opportunity to clarify their positions, scheduling the next hearing for October 19.

Previously, aircraft lessors had approached the Delhi High Court seeking deregistration of their planes held by Go First. However, the existing moratorium had prevented them from reclaiming their aircraft.
On Wednesday, the MCA's directive excluded all transactions and contracts related to aircraft and their engines from the moratorium under Section 14 of the IBC. This move is expected to empower lessors to swiftly retrieve their aircraft from airlines.

Over the past months, aircraft lessors had expressed frustration after the National Company Law Tribunal (NCLT) in May prohibited them from reclaiming their planes from Go First, which halted flight operations on May 3 after filing an insolvency application with the tribunal.