• Notification Date: 27-10-2023
• Notification No: N/A

Delhi HC: DGCA needs to Clarify stand on MCA Notification on Moratorium

The Delhi High Court on Thursday told the Director General of Civil Aviation (DGCA) to submit a response on whether the Ministry of Corporate Affairs' notification exempting all transactions and agreements related to aircraft and their engines from the moratorium under the Insolvency and Bankruptcy Code (IBC) applies to the Go First case. 

A moratorium period is the suspension of all or certain legal remedies against debtors. 

The court was hearing a case by aircraft and engine lessors of Go First against the DGCA for the release of their aircraft. 

Senior Advocate Neeraj Kishan Kaul and Ramji Srinivasan, appearing for the Resolution Professional, said they will put forth fresh submissions in the case. 

Meanwhile, Additional Solicitor General Chetan Sharma sought some time to get clarity from the government on the applicability of the notification in Go First's case. 

However, Senior Advocates Amit Sibal and Dayan Krishnan, appearing for the lessors, said this was not necessary as the government's notification is clear. 

Justice Tara Vitasta Ganju will hear the arguments from November 3. 

The Ministry of Corporate Affairs on October 3 exempted all transactions and agreements related to aircraft and their engines from the moratorium under Section 14 of the Insolvency and Bankruptcy Code. 

The MCA's notification is set to allow lessors to promptly take their planes back from airlines. 

Go First had filed for insolvency in May, after which the moratorium period kicked in, meaning that the aircraft could not be taken back by the lessors. The lessors had then moved the NCLT as well as the Delhi High Court to access the leased aircraft.