The National Company Law Tribunal (NCLT) on Thursday reserved its order on embattled airline Go First’s plea seeking voluntary insolvency resolution proceedings and interim moratorium on financial obligations.

While aircraft lessors opposed the plea, the counsels for Go First told the tribunal that it is seeking a comprehensive debt restructuring and the petition is not a malicious one to avoid payment of dues to its creditors but to revive the airline and save the company.

The counsels also requested the tribunal to grant an interim moratorium on an urgent basis to keep the carrier as a going concern and protect the fleet from being taken away by the lessors by enforcing their contractual rights.

Amid the airline facing severe financial crunch and cancelling flights, a two-member NCLT bench comprising President Justice Ramalingam Sudhakar and Member L N Gupta heard the arguments for and against the petition for nearly four hours. 

Senior advocates Neeraj Kishan Kaul and P Nagesh submitted that the airline’s several bank guarantees are being encashed and that the carrier has also received notices for termination of aircraft leases, news agency PTI reported.

The company has an “impeccable” financial record and before the pandemic, it was having around 8% of the overall domestic aviation market. It is now facing problems because of the dispute with Pratt & Whitney over the supply of the engine, they said.

The Wadia group-owned airline has liabilities worth Rs 11,463 crore and has cancelled all its flights till May 9 while sale of tickets has been suspended till May 15. 

When the NCLT bench asked how the interim moratorium would help Go First, Kaul said, “It will keep the airlines in a going concern”.

Under the insolvency resolution process, an Interim Resolution Professional (IRP) takes over the control of the company concerned and will discharge his or her duties with the guidance of the Committee of Creditors (CoC).

Further, the bench wondered “how one IRP can run the company when so many professionals could not run it?”.

In response, Kaul said the airline has proposed the name of Abhilash Lal from Alvarez & Marsal as an IRP. It is the same firm which was also roped in by Jet Airways, which had gone into insolvency proceedings in 2019, PTI reported.

Citing the example of Jet Airways, they submitted that when Corporate Insolvency Resolution Process (CIRP) was initiated against that airline, it had over 100 aircraft but by the time a resolution was reached, only 11 were left.”

IBC says that during CIRP the corporate debtor should be in a ‘going concern’ and not as a ‘grounded concern’,” Kaul said.

In its petition filed through advocate Pranjal Kishore, Go First has sought various interim directions from NCLT including restraining lessors from taking back aircraft and regulator DGCA from taking any adverse action against the airline.