DGCA orders Go First to stop selling air tickets with immediate effect

With liabilities worth ₹11,463 crore and a financial crunch, Go First has sought voluntary insolvency resolution proceedings

May 08, 2023 02:53 pm | Updated May 10, 2023 12:17 pm IST

Passengers near a ticketing office of Go First airlines at Birsa Munda Airport in Ranchi. The airline has filed for bankruptcy. File

Passengers near a ticketing office of Go First airlines at Birsa Munda Airport in Ranchi. The airline has filed for bankruptcy. File | Photo Credit: PTI

The aviation safety regulator on May 8 ordered Go First to immediately stop selling air tickets, and has also served it a showcause notice before taking a decision to revoke the airline’s permit to offer commercial flights.

“Go First has been directed to stop booking and sale of tickets directly or indirectly, with immediate effect and until further orders,” the Directorate General of Civil Aviation said in a press statement.

Also Read | Symptomatic stall: On the Go First crisis and the aviation industry

Additionally the DGCA has issued a showcause notice on the airline “for their failure to continue the operation of the service in a safe, efficient and reliable manner.” It has asked Go First to reply within 15 days and said “further decision on the continuation of their Air Operators Certificate (AOC) will be taken on the basis of the reply”.

Earlier, the airline announced flight cancellations in a staggered manner. First, on May 2 it abruptly announced cancellation of flights for a period of three days from May 3 to May 5, which was then extended till May 9. Later, it extended the cancellations until May 12.

The airline was awaiting an order from the National Company Law Tribunal on its insolvency plea and an interim moratorium to protect its aircraft from being re-possessed by lessors due to non-payment of dues. The airline has 28 out of 54 aircraft grounded due to delays from engine maker Pratt and Whitney in providing spares and servicing, what the airline has called, under-performing engines. This, it has said, led to a loss of over Rs 10,000 crore for the airline. The airline has total dues amounting to Rs 11,463 to its various creditors.

As many as 77,000 passengers were affected after the airline cancelled 4,118 flights over a period of 30 days until May 6. The airline also informed courts that a total of 19 lakh passengers were booked with it for travel on future dates. The airline’s CEO Kaushik Khona told The Hindu that the total value of refunds for passengers who booked directly through the airline amounted to “Rs 30-40 lakh”. But it is estimated that dues pending with travel agents and booking portals could be twice as much. They have demanded that the airline should issue refunds in cash instead of handing out credit notes to enable them to address customer grievances.

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