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NCLT has dissolved the board of the airline and appointed Abhilash Lal for the bankruptcy resolution process. The airline has been asked to deposit Rs 5 crore and it has also been ordered not to lay off any employee.
The debt-ridden airline Go First is likely to resume its operations from May 24 with limited aircraft and a few routes.
The airline currently has 57 aircraft in its fleet. No details have been released about how many aircraft the company will start operating with. The decision came after the National Company Law Tribunal accepted the company’s insolvency petition May 10
Earlier, the company had informed about cancellation of all flights till May 19. After this, the airline has announced to start flights from 24 May.
On May 10, NCLT had approved Go First’s petition for bankruptcy. Also, NCLT has dissolved the board of the airline and appointed Abhilash Lal for the bankruptcy resolution process. The airline has been asked to deposit Rs 5 crore and it has also been ordered not to lay off any employee.
According to reports, the banks that gave loans to Go First are also supporting the insolvency of the company. Banks apprehend that the airline may go the way of Jet Airways and all their money will be become unrecoverable. This is the reason why banks are also supporting the insolvency process. The airline had filed for bankruptcy on May 2.
Go First has a total of 57 Airbus A320 aircraft in its fleet. About 90% of these aircraft have engines from Pratt & Whitney. About 50 percent of these aircraft were grounded due to engine problems. The airline has blamed the engine maker for the problems it is facing now. But P&W on its part said the airline has been a serial offender as far as the payments go.
Go First, owes about Rs 11,463 crore to banks, airlines lessors and the engine maker Pratt & Whitney. It may be be noted here that the airline has not defaulted on loan payments yet.