Go First Liquidation Order Upheld in Appeals
The India National Company Appellate Law Tribunal has dismissed several appeals against a January 2025 ruling that ordered the liquidation of Go First. Justice Ashok Bhushan delivered his decisions on April 4, rejecting separate appeals brought by the trade union Bhartiya Kamgar Sena Mumbai, former employee Arjun Dhawan and others, as well as the investment vehicle Busy Bee Airways Pvt. Ltd, which is owned by Nishant Pitti. This latest development reaffirms the earlier liquidation order and leaves Go First’s future in serious doubt, as creditors and lenders now look to recover part of the INR65.21 billion rupees (USD759 million) owed to them.
The ruling has significant implications for the airline, which collapsed in May 2023 amid mounting financial challenges. The liquidation order was seen as an inevitable outcome after persistent operational and financial struggles, and the tribunal’s decision to dismiss the appeals indicates that efforts to reverse this process have lost momentum. Nishant Pitti, known for founding the online travel agency EaseMyTrip, was perhaps the highest-profile individual attempting to revive the beleaguered carrier. Pitti had been actively involved in trying to breathe life back into Go First, arguing that the airline still possessed viable intangible assets, including its brand value and the licence issued by the Directorate General of Civil Aviation.
Despite his failure to secure a suspension of the liquidation order, Pitti is not without recourse. He retains the right to submit an asset buyout proposal to Go First’s liquidator and the committee of creditors. Pitti’s strategy centers on the belief that the airline’s non-physical assets could provide a foundation for future recovery, despite the substantial debts it has incurred. His earlier efforts included a partnership with Ajay Singh, the owner and managing director of SpiceJet, with the intent to bid for Go First when it was put up for sale last year. However, these plans were abruptly halted when a court issued an order for the deregistration of Go First’s aircraft, mandating their return to the respective lessors, thereby ending any immediate prospects of a buyout or restructuring.
The tribunal’s decision underscores the challenges faced by airlines in distress, particularly in a competitive market that is unforgiving to financial mismanagement and operational inefficiencies. By dismissing the appeals, the tribunal has cleared the way for creditors and lenders to start the process of asset recovery, an outcome that may eventually stabilize some of the losses incurred by those who provided financial support to the carrier. While the liquidation process is expected to yield only partial recovery of the outstanding debts, it represents a necessary step in resolving the liabilities accumulated over the years.
For industry observers, the finality of this decision marks a critical juncture in the fallout from Go First’s collapse. The case serves as a cautionary tale for other carriers facing similar financial distress, highlighting the importance of maintaining a robust balance sheet and the potential consequences of failing to adapt to rapidly changing market conditions. As the liquidation process moves forward, the focus will now shift to how the proceeds are allocated among creditors and whether any residual value can be harnessed from Go First’s intangible assets. The dismissal of the appeals represents a definitive moment in the airline’s turbulent journey, one that will likely influence restructuring practices and creditor negotiations in the broader aviation sector.
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Sources: AirGuide Business airguide.info, bing.com, ch-aviation.com