Aviation Regulator DGCA (Directorate General of Civil Aviation) has temporarily put on hold requests from lessors to repossess planes from cash-strapped Go First as the airline's insolvency proceedings impose a freeze on such assets.

While the DGCA has not rejected lessors' de-registration requests, they have been placed on hold, news agency Reuters reported citing court filings. The aviation watchdog said that while the insolvency process is taking place it cannot legally approve repossession requests from lessors, leaving it "no other option" but to keep all applications "pending in abeyance".

Lessors' move to take back possession of aircraft operated by Go First could jeopardise the Wadia group's plans to revive the beleaguered airline. If the planes are returned, the airline may find it hard fly again.

This comes a week after the lessors of Go First faced a major setback after the National Company Law Appellate Tribunal (NCLAT) upheld the initiation of insolvency proceedings against the low-cost carrier. The admission of Go First's voluntary insolvency by NCLT Delhi had brought the airline's assets under moratorium.

Go First's lessors including Pembroke Aircraft Leasing, SMBC Aviation, GY Aviation Leasing, Jackson Square Aviation and BOC Aviation have initiated separate legal action to repossess their planes. Lessors are seeking de-registration of 44 aircraft operated by Go First.

Meanwhile, the Wadia Group-owned airline today cancelled all scheduled flights till June 4 due to 'operational reasons'. Go First said it will issue a full refund for the flight cancellations to the original mode of payment. "The company has filed an application for immediate resolution and revival of operations. We will be able to resume bookings shortly," the debt-laden carrier said.

Go First had filed for bankruptcy with the National Company Law Tribunal (NCLT) on May 2, citing the ever-increasing 'failure' of Pratt & Whitney engines that power its fleet. By May 1, the low-cost carrier had grounded its 25 aircraft, or around 50% of its Airbus A320neo fleet, due to 'failing engines' supplied by Pratt & Whitney's International Aero Engines.

"The percentage of grounded aircraft due to Pratt & Whitney's faulty engines has grown from 7% in December 2019 to 31% in December 2020 to 50% in December 2022," the budget carrier said, adding it lost ₹10,800 crore in revenues and additional expenses.

Go First claims it was forced to file for insolvency at the NCLT after Pratt & Whitney refused to comply with an award issued by an emergency arbitrator. The order directed Pratt & Whitney to release and dispatch without delay at least 10 serviceable spare leased engines to Go First by April 27, 2023 and a further 10 spare leased engines per month until December 2023.

According to data released by DGCA, Go First's domestic market share fell to 6.4% in April from 6.9% in March. The airline flew 8.29 lakh passengers in April compared with 8.95 lakh flyers in March. The budget carrier's on-time performance rate was the lowest in April at 41.7%.

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