Go Airlines | NCLAT Delhi Permits Lessor To Conduct Inspection Of Leased Aircraft Engines

“We are of the view that inspection be permitted within 10 days from today. As observed above, the observations made in the impugned order being at prima facie stage need not be treated as final expression of opinion by the Adjudicating Authority and all contention of both the parties are left open.”

Background Facts

M/s Go Airlines (India) Limited (“Corporate Debtor/Go Airlines”) is engaged in the business of Airlines and is the third largest airline operator in India. On 10.05.2023, the Corporate Insolvency Resolution Process (“CIRP”) was initiated against Go Airlines by the NCLT.

Engine Lease Finance B.V. (“Lessor/Appellant”) is a lessor of the aircraft engines which were leased out to Go Airlines. The Lessor filed an application under Section 60(5) of IBC before the NCLT, seeking permission to depute an agency or an inspector to conduct inspection of the Four Engines leased to Go Airlines. On 26.07.2023, the NCLT rejected the prayer and granted interim relief only to the extent of protection and maintenance of aircraft/engines by the Resolution Professional.

The aircraft lessors of Go Airlines had approached the Delhi High Court in writ jurisdiction, whereby the High Court on 05.07.2023 issued a direction to the Resolution Professional to permit inspection of the Aircrafts. The Resolution Professional filed an appeal against the order dated 05.07.2023. However, the Appellate Court on 12.07.2023 refused to interfere with the direction pertaining to the inspection.

The Lessor contended that in view of the High Court order, inspection of the engines can be permitted. Further, the Resolution Professional has already permitted inspection with respect to some Aircraft lessors.

NCLAT Verdict

The Bench opined that the NCLT’s order, to the extent of refusing inspection to the Lessor, cannot be sustained. The Resolution Professional has been directed to permit inspection within 10 days.

“After having considered the submissions of the Counsel for the parties and perusing the record, we are of the view that the order of the Adjudicating Authority insofar as it refuses inspection to the Appellant need not be approved.”

The Resolution Professional has submitted that the inspection shall be allowed in pursuance of the High Court’s order and the date of inspection would be intimated to the Lessor.

The Bench held that the observations made by the NCLT in order dated 26.07.2023 should not be considered final, since the same has been made at prima facie stage. The contentions of the parties are left open.

“We are of the view that inspection be permitted within 10 days from today. As observed above, the observations made in the impugned order being at prima facie stage need not be treated as final expression of opinion by the Adjudicating Authority and all contention of both the parties are left open.”

Appeal has been disposed of.

Case Title: Engine Lease Finance B.V. v Resolution Professional of Go Airlines (India) Ltd. & Anr.

Case No.:

Counsel For Appellant: Mr. Anand Venkatramani, Mr. Saket Satapathy, Mr. Anubhav Dutta, Mr. J Shiva Kumar, Ms. Priyal Shah, Ms. Nikita Sharma, Advocates.

Counsel For Respondents: Mr. Ramji Srinivasan, Sr. Advocate with Mr. Vishnu Shriram, Mr. Yugam Taneja, Ms. Namrata Saraogi, Mr. Kartik Pandey, Advocates for RP.

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