GoFirst1Image Credit source: File Photo
Aviation regulator DGCA said on Tuesday that the request to take back the aircraft of the lessors of GoFirst airline going through the crisis has been put on hold and not rejected. On the other hand, GoFirst has once again moved forward the date of starting flights. The carrier has postponed all flats till June 4.
In fact the Government of India is a signatory to the Cape Town Convention, a convention made in 2001 to protect repossession rights. DGCA argues that there is no local law implementing it in our country, due to which it is not effective here. The DGCA filing states that Lokan lodges are “stronger and more powerful than any international treaty.
Why is the DGCA not listening to the leisures
According to the regulator, it is not able to take any action on the request of the lessors of GoFirst because all the assets of the company have been frozen due to the airline going into insolvency. The DGCA said that as per the local law, lessors cannot get back the aircraft until the bankruptcy protection on the airline is over.
Request put on hold
After granting bankruptcy protection, NCLT ordered freezing of all the assets of GoFirst. While some lessors had already terminated the lease and requested the aviation regulator to take back more than 40 aircraft. According to DGCA, the insolvency process is going on, due to which they cannot approve the request of legal lessors. Because of which this request has been put on hold.
Discussion on resolution plan as well
GoFirst’s lessors, including Standard Chartered’s Pembroke Aircraft Leasing, SMBC Aviation, CDB Aviation’s GY Aviation Leasing, Jackson Square Aviation and BOC Aviation, have launched separate legal actions to recover their aircraft . Senior officials of GoFirst, which is going through the insolvency resolution process, also discussed their resolution plan with DGCA officials on Monday. The meeting in New Delhi was held because last week the DGCA had asked the grounded airline to submit its resolution plan within 30 days.
Flight canceled till June 4
The budget carrier filed a petition for voluntary insolvency resolution on 2 May, citing its inability to operate due to non-delivery of engines by American engine maker Pratt & Whitney. On 10 May, the National Company Law Tribunal accepted the petition of the airline, which did not fly from 3 May. The airline has canceled the flight till June 4 and said that a full refund will be issued to the passengers.
Promise to give retention allowance
On the other hand, GoFirst has offered to pay Rs 1 lakh per month to its captains as ‘retention allowance’ in addition to their salary. According to the airline, GoFirst executives will get an additional Rs 50,000 per month as retention allowance in addition to their existing salaries. These allowances will be paid from June.
