Go First Lessors Vs DGCA: Delhi High Court Reserves Order

The Delhi High Court on Thursday reserved its order in the dispute between Go First's lessors and the Directorate General of Civil Aviation.

The court was hearing the plea filed by the lessors, seeking direction to the DGCA to deregister the planes leased to Go First. The aviation regulator has submitted that it hasn't rejected the lessors' applications to deregister the planes. Instead, those applications were only put on hold due to the ongoing moratorium imposed by the National Company Law Tribunal. 

The regulator had previously told the court that the Cape Town Convention, to which India is a signatory, cannot incline them towards deregistering the planes as local laws prevail over international treaties. This 2001 convention deals with the repossession of aircraft by the lessors after the termination of contracts with the airline.

Senior advocate Mukul Rohatgi appeared on behalf of Pembroke Aircraft Leasing and explained the difference between Pembroke's stance from other lessors. He said that Pembroke had leased two planes and one of them had already been deregistered.

This process took place prior to the insolvency proceedings initiated before the NCLT by Go First. He said the other plane left to be deregistered did not have its engine and airworthiness documents as those have already been delivered to the lessor.

The lessors also argued that if their right to repossess the planes is to be restricted, it can only be done by express law and not by the DGCA. The IRP shall not take possession of the property of a third party in the process, they submitted.

Seeking deregistration of the planes after the termination of leases does not have anything to do with the insolvency, the lessors argued.

On May 22, the National Company Law Appellate Tribunal upheld the decision of the NCLT that had admitted Go First into insolvency. The appellate tribunal had also given the lessors the opportunity to move to the NCLT with any relevant applications in the matter. 

However, a few lessors—including Accipiter Holdings, Pembroke Aircraft, SFV Aircraft Holdings, ACG Aircraft Leasing, EOS Aviation 12, SMBC Aviation Capital and DAE SY 22 13 Ireland—approached the high court, seeking directions to the DGCA to deregister their planes leased to Go First.