SMBC Aviation Capital Files Appeal Against NCLT's Decision Granting Go First's Voluntary Insolvency Plea

SMBC Aviation Capital Ltd, a leading aircraft leasing firm on wednesday lodged a challenge with the National Company Law Appellate Tribunal (NCLAT) against the decision made earlier in the day by the National Company Law Tribunal (NCLT) that granted Go First's request to begin insolvency proceedings voluntarily.

The legal counsel of SMBC Aviation Capital quickly approached the NCLAT after the NCLT granted Go First's plea and presented the request before a bench presided by Chairman Justice Ashok Bhushan.

The action was taken in response to the NCLT's prohibition on lessors returning their aircraft to Go First, which prompted legal action by a number of the airline's lessors, notably SMBC Aviation Capital.

The NCLAT Chairman instructed to list the matter for hearing on Thursday after listening to the aircraft lessor. The hearing for SMBC Aviation Capital's appeal is scheduled for Thursday before the two-member bench made up of Justice Ashok Bhushan and Barun Mitra, according to the cause list.

Several aircraft lessors have contacted the DGCA, the aviation authority, in the last week to request the deregistration and repossession of 45 Go First aircraft. These actions come after several lessors, including SMBC Aviation Capital Ltd, Narmada Aviation Leasing, Yamuna Aviation Leasing, GAL MSN, and GY Aviation Lease, expressed their opposition to Go First's petition during a hearing at the NCLT last week.

The lessors also indicated their intent to file an application under Section 65 of the Insolvency and Bankruptcy Code (IBC) in response to what they deemed as fraudulent or malicious initiation of proceedings.

According to a statement made by the NCLT on Wednesday, there is "no bar in entertaining/ considering/ adjudicating" a Section 65 application following the start of the insolvency resolution process. "Keeping in mind the urgency of the instant case, to protect and maximise the value of the assets in line with the objectives of the IBC, employment involved, and the larger public interest, the judicial propriety demands, it will not be apt to wait for the filing of the Section 65 application," the NCLT said.

Go First halted operating as of May 3, and the aviation watchdog DGCA on Monday ordered the airline to halt ticket sales pending further instructions. Earlier in the day, the NCLT's Delhi-based principal bench suspended the board of Go First and assigned an interim resolution specialist to handle its business.