In a recent development concerning the financially- troubled Go First airline, the Resolution Professional (RP) has presented a significant affidavit to the Delhi High Court. According to the submitted document, as of 10 October, 2023, about 2,278 employees remain on the company’s payroll, with none currently fulfilling their work responsibilities.
The affidavit by RP Shailendra Ajmera discloses that various members of the engineering and records team, crucial for maintenance activities, have either resigned gradually or are staying away from work due to the non-payment of salaries. This revelation comes after the lessor filed a contempt petition, alleging that Ajmera hindered them from inspecting the aircraft.
Responding to the contempt petition, Ajmera asserts that it lacks bona fide intent and aims solely to delay the final arguments in ongoing writ bpetitions. He contended that the petitioner’s objective is to disrupt the Corporate Debtor’s operational cash flows, causing further challenges for the airline.
The RP denied the allegations in the contempt petition, and revealed that the records of the Corporate Debtor indicate unpaid salaries for the month of April 2023, predating the commencement of Corporate Insolvency Resolution Process (CIRP) on 10 May, 2023. Despite utilising available funds to pay salaries for May 2023 and securing funds from the Committee of Creditors (CoC) for June 2023 salaries, the airline faces a severe financial crunch due to the prohibition on flying operations.
The affidavit highlights the inability of the Corporate Debtor to generate revenue for salary payments and critical operational expenses, including maintenance, essential for maintaining the going concern status of the airline.
On 5 December, the Delhi High Court directed the RP to respond to a lessor’s plea seeking contempt action. Justice Tara Vitasta Ganju, presiding over the case, emphasised the importance of following court orders and expressed concern about the non-maintenance of aircraft, affecting all involved parties.