Aviation: DGCA orders Go First to stop selling tickets immediately
Virendra Pandit
New Delhi: Crisis-ridden budget airline Go First got a shocker on Monday when aviation regulator Director-General of Civil Aviation (DGCA) ordered it to stop bookings and selling tickets, directly or indirectly, with immediate effect and until further notice.
Earlier, the media reported that the airline had suspended ticket sales until May 15 and canceled flights until May 12.
The DGCA also issued a show-cause notice to the no-frills carrier under the provisions of the Aircraft Rules, 1937, for its failure to continue the service operation in a safe, efficient, and reliable manner, the reports said.
The troubled airline has filed a plea for voluntary insolvency resolution proceedings before the National Company Law Tribunal (NCLT), which has reserved its order.
In a show-cause notice, the aviation watchdog directed the airline to submit its reply within 15 days, following which the regulator will take a decision on the continuation of its Air Operators Certificate (AOC) will be taken.
In the last few months, the Wadia-owned Go First hit the headlines for all the wrong reasons. In January, its Bengaluru-New Delhi flight allegedly took off leaving more than 50 confirmed passengers, waiting on the tarmac, in the lurch. It invited the DGCA’s wrath and a fine of Rs. 10 lakhs.
The airline, which quickly lost market share despite an air traffic boom in India, canceled all flights on May 2 and 3 because of a severe shortage of resources. It also filed for voluntary insolvency resolution proceedings before the National Company Law Tribunal (NCLT) in Delhi.
For months, Go First, which until now had a cash-and-carry deal with oil companies, faced a cash crunch and failed to pay for the fuel. It also did not get any credit from the fuel suppliers.
In addition, about half of its aircraft fleet of the Airbus A320 family remained grounded because of issues with its US-based Pratt & Whitney (P&W) engine suppliers and lease rental payment delays. It could not pay salaries in time, forcing several of its pilots to seek rehabilitation in other airlines, including the Tata-owned Air India.
With 28 out of its fleet of 55 aircraft grounded for over a year, the company, employing over 5,000 people, bled heavily because of a dwindling cash flow.
The Wadia group, which also owns Bombay Dying & Manufacturing Co Ltd, has infused nearly Rs. 30,000 crores (USD 366.2 million) in the last 15 months to keep the airline afloat. It is no longer willing to invest more until the issue with P&W is resolved,
