The National Company Law Appellate Tribunal (NCLAT) on Friday upheld the liquidation order for Go First Airlines, marking a significant setback to any plans for the airline’s revival through the traditional insolvency resolution process. The verdict effectively seals the fate of the grounded carrier under the current framework of the Insolvency and Bankruptcy Code (IBC).
The bench, comprising Chairperson Justice Ashok Bhushan and Members Barun Mitra and Arun Baroka, noted that while the liquidation stands, a narrow possibility remains for the airline’s revival. The tribunal clarified that a scheme of compromise or arrangement under Section 230 of the Companies Act, 2013, could still be pursued.
“We have also observed above that it is always open for the Appellant – M/s. Busy Bee or any other eligible Applicant, to submit a scheme for compromise and arrangement before the Liquidator as per Regulation 2B of the Liquidation Process Regulation,” the order stated.
This opens the door, albeit slightly, for interested parties to propose a revival plan outside the scope of conventional resolution processes. Section 230 allows for a potential restructuring or compromise scheme between creditors and the company, subject to approval by the National Company Law Tribunal (NCLT).
Go First, which ceased operations in May 2023, has been undergoing insolvency proceedings since then, with several interested bidders expressing concerns over operational liabilities and aircraft repossession disputes. The airline’s lessors and creditors have been closely watching the developments, given the large financial implications involved.
While liquidation appears imminent, the mention of a potential Section 230 proposal offers a faint glimmer of hope for those still interested in salvaging the embattled airline.
