Lessor-airline conflict. GoFirst challenges Delhi High Court order

Go First has approached the Division Bench of the Delhi High Court to appeal against a recent single-judge order which granted aircraft lessors access to 30 planes leased to Go First for the purpose of carrying out maintenance work. The appeal was mentioned before a Bench led by Chief Justice Satish Chandra Sharma, and Senior Advocate Sandeep Sethi requested urgent listing of the case. The matter will be heard on Monday.

The single-judge order, passed by Justice Tara Vitasta Ganju, allowed lessors to inspect and maintain their leased aircraft and restrained Go First and its resolution professional from removing any parts from the planes. The lessors had initiated the plea for de-registration of their aircraft, asserting that they terminated their lease agreements with Go First due to the airline’s multiple payment defaults.

The matter arose after Go First filed for insolvency before the National Company Law Tribunal (NCLT) in Delhi, and the NCLT admitted the plea, imposing a moratorium. The NCLT’s decision was later upheld by the National Company Law Appellate Tribunal. The lessors sought permission to inspect and conduct maintenance work on their 30 aircraft and their parts at regular intervals.

In response to the lessors’ plea, the Delhi High Court directed the Director General of Civil Aviation (DGCA) and the airports where the aircraft are parked to grant access to the lessors within three days. The court’s interim order also prohibited Go First’s resolution professional and employees from removing or replacing any part or component of the leased aircraft without explicit permission from the lessors.

The court recognised the necessity of regular maintenance of aircraft, which are complex and expensive machinery. A final hearing on the matter is scheduled for August, while the next hearing in the case is set for August 3. The lessors, including Pembroke Aviation, Accipiter Investments Aircraft 2 Ltd, EOS Aviation, and SMBC Aviation, had filed a writ seeking the release of their leased planes from Go First, which is facing financial distress.

The legal representatives of the lessors argued that the lessor-airline relationship is governed by contractual agreements and modifying these terms without legal sanction could have consequences for the Indian aviation sector. The DGCA, a respondent in the case, clarified that they were following the court’s orders and had not rejected any lessor’s application for repossession during the moratorium.