Accipiter Investments Aircraft 2 Limited Vs Union of India & Anr. (Delhi High Court)
The Delhi High Court, in Accipiter Investments Aircraft 2 Limited Vs Union of India & Anr., ruled in favour of aircraft lessors seeking deregistration of 54 aircraft leased to Go Air (India) Limited, popularly known as Go First, notwithstanding the airline’s ongoing corporate insolvency resolution process. The Court set aside the Directorate General of Civil Aviation’s (DGCA) communications refusing to process the deregistration applications on account of the moratorium imposed under Section 14 of the Insolvency and Bankruptcy Code, 2016 (IBC). It held that the DGCA was required to exercise its statutory powers under Rule 30(7) of the Aircraft Rules, 1937, and that insolvency proceedings could not automatically defeat the rights arising from aircraft lease agreements terminated before commencement of the moratorium. The judgment, delivered on 26 April 2024, disposed of 14 connected writ petitions involving several international aircraft leasing companies.
The dispute arose after Go First defaulted in paying lease rentals to the petitioners, who had leased 54 aircraft to the airline under separate agreements. Following continuing payment defaults, the lessors issued termination notices between 2 May 2023 and 4 May 2023 and submitted applications to the DGCA for deregistration under Rule 30(7) of the Aircraft Rules. These applications were supported by Irrevocable De-Registration and Export Request Authorisations (IDERA), executed pursuant to the Cape Town Convention and Cape Town Protocol framework. Meanwhile, Go First filed an application under Section 10 of the IBC, which the National Company Law Tribunal (NCLT) admitted on 10 May 2023, declaring a moratorium under Section 14. Subsequently, the DGCA refused to process the deregistration requests, relying upon the insolvency commencement order. The lessors challenged these refusals before the High Court, arguing that their contractual rights had crystallised before commencement of the insolvency proceedings.
