The National Company Law Appellate Tribunal (NCLAT) on Friday allowed Engine Lease Finance BV to inspect four of its engines leased to bankrupt airline GoFirst.

NCLAT gave the resolution professional (RP) of the airline 10 days to give the date of inspection to the engine lessee.

The NCLAT modified an interim order of the National Company Law Tribunal (NCLT) which had said that the lessees were not allowed to inspect GoFirst’s aircraft or parts.

“The denial of inspection by the Adjudicating Authority (NCLT) is not justified. Inspection of locomotives is allowed,” NCLAT said. It also said that other issues raised by the parties will be addressed by the NCLT in the next hearing on September 1.

The lessors told the NCLAT that each engine cost $15 million and needed maintenance. It said that RP had sent him a letter on June 5 on the subject of inspection of locomotives but no date was specified for the same.

The lessors said that while the NCLT had not allowed them to inspect the locomotives, the Delhi High Court had allowed the same. The company pointed out that the moratorium granted to GoFirst should not apply to locomotives, but the NCLT had ruled otherwise.

Meanwhile, the counsel for RP submitted that since the main matter is pending before the NCLT, the NCLAT should not get involved.

The NCLT on July 26 said that GoFirst can operate aircraft in its possession if those aircraft are still registered with the civil aviation regulator.

“It is pertinent to mention that the Directorate General of Civil Aviation (DGCA) has not de-registered the planes, which means they are available for the corporate debtor (Go 1st in this case) to resume operations. Therefore, so long as the aircraft/engines are registered, they can be used for operation or flight to keep the corporate debtor as a going concern, however, within the safeguards/safety norms prescribed by the regulators,” NCLT stated in the interim order.

The tribunal was hearing a petition filed by the lessors – BlueSky 31 Leasing Company, BlueSky 19 Leasing Company, Jackson Square Aviation Ireland, SMBC Aero Engine Lease, Engine Lease Finance and BOC Aviation (Ireland) – primarily seeking to give GoFirst the lease of the aircraft. There was a demand to stop the operation. owned by him for commercial use. The tribunal said that to keep GoFirst alive it would have to fly leased aircraft.

“In order to maintain the corporate debtor as a going concern, the aircraft has to be flown, therefore, the aircraft will remain with the corporate debtor and will be operated by the corporate debtor. Therefore, we see no reason to allow this interim relief claimed by the applicants (engine and aircraft lessors),” the order said.


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