The National Company Law Tribunal (NCLT) has granted a 60-day extension to the Corporate Insolvency Resolution Process (CIRP) of the grounded airline Go First. This extension, announced on 12 June, follows interest from three potential buyers for the airline.
"We are not recording this in the order, but this is the final extension," the NCLT stated during the proceedings. This marks the fourth extension for Go First, requested by its lenders. The CIRP deadline is now set for 3 August, 2024.
During the hearing, the lawyer representing the airline's resolution professional (RP) cited the Delhi High Court's recent judgement instructing the Directorate General of Civil Aviation (DGCA) to deregister all 54 of Go First's aircraft as an extraordinary situation necessitating the extension. The RP indicated that the interested buyers have revised their offers, which the lenders have yet to review, thereby justifying the need for additional time.
Despite granting the extension, the NCLT criticised the RP for repeatedly requesting extensions without substantial progress in the resolution plan. "The lenders cannot simply pass a resolution to extend the resolution process and expect us to pass an order," the tribunal asserted.
Under the Insolvency and Bankruptcy Code (IBC) of 2016, a resolution process is initially allotted 180 days, with the NCLT empowered to extend this to a maximum of 330 days. The 330-day period for Go First ended in April 2024. Nonetheless, the NCLT has continued to grant extensions, using its discretionary power to provide the airline with an opportunity to recover.
As the CIRP approaches its new deadline, the involved parties face increased pressure to finalise a resolution and avoid the liquidation of Go First.
