blog/article-blog/Go-First (Go Air) to go through Voluntary Insolvency Process

May 29, 2023

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Go-First (Go Air) to go through Voluntary Insolvency Process

End of an Era- Go First (Go Airlines) goes through Voluntary Insolvency

In what is being termed as the end of an era, Go Airlines, popularly known as Go First has applied for voluntary insolvency. The unlisted share price of Go Airlines is available on the Planify platform. Go Air has become the second airline to file for insolvency after another once highly popular airline Jet Airways filed for insolvency back in 2019. Many investors fear that the Civil Aviation industry might be heading the telecom way.

Defining voluntary insolvency:

  • In layman's terms, voluntary insolvency indicates that the corporation has admitted that it is insolvent, a firm that declares that it is unable to pay its debts and requires assistance from someone to resolve the situation.


  • If the company becomes insolvent, it can go into voluntary liquidation. This procedure refers to the dissolution of a firm with the approval of its shareholders and creditors. It is a time-bound process that must be completed within 270 days after the start of Voluntary Liquidation.

News Summary - Go First files for voluntary insolvency proceedings with NCLT:

  • Cash-strapped carrier, Go First is the first Indian carrier to file for insolvency under the Insolvency and Bankruptcy Code (IBC) since Jet Airways. The company has filed a petition to NCLT (The National Company Law Tribunal) for voluntary insolvency.


  • IBC is a comprehensive piece of law adopted by the government in 2016 to deal with insolvency and bankruptcy processes in a timely and efficient manner. 

  • The IBC establishes a number of significant institutions, including The Insolvency and Bankruptcy Board of India (IBBI), which regulates insolvency professionals and information utilities

  • NCLT, which hears and decides corporate insolvency cases.


  • The IBC's principal goal is to encourage entrepreneurship and ease the settlement of distressed assets while balancing the interests of all stakeholders.

Reason – For voluntary insolvency:

  • Unavailability of Aircraft: For many quarters, the airline has faced headwinds due to aircraft availability. Pratt & Whitney engines power all of its A320neo aircraft, and the engine manufacturer has experienced difficulty sourcing replacement engines. As a result, the airline was obliged to halt 25 planes. This represents over half of its Airbus A320neo aircraft fleet as of 1 May 2023.


  • Financial Performance: According to Go First, the grounding of nearly half of its A320neo fleet, cost the company a whopping $10,800 crore in income. The airline has also demanded 8,000 crores in compensation from the Singapore International Arbitration Centre (SIAC), a premier institution for the resolution of commercial disputes through arbitration. The Singapore Ministry of Law was formed in 1991 as an independent, non-profit organization. Its goal is to create an impartial and efficient platform for commercial dispute settlement. If the arbitration is successful, the corporation will be able to address the liabilities of both small and large creditors.


Now what next:

  • Because of ongoing problems with Pratt and Whitney engines, Go First has applied to the NCLT. According to the airline, the engine supplier failed to fix those engines and/or deliver enough spare leased engines.


  • Once the application has been accepted under NCLT, an interim resolution specialist will take over and run Go First.

Unlisted Shares of Go First are available only on Planify:


Go first shares are now available at Planify's marketplace. Investors have an exclusive chance to invest in Unlisted shares of Go Air only through our website & app & get the shares delivered directly to their Demat A/C.



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