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of <h1>DGCA must deregister 54 Go Air aircraft after lease termination under Rule 30(7) Aircraft Rules 1937</h1> <h3>Accipiter Investments Aircraft 2 Limited, Bluesky 31 Leasing Company Limited, Eos Aviation 12 (Ireland) Ltd., Pembroke Aircraft Leasing 11 Limited, Smbc Aviation Capital Limited And Ors., Dae Sy 22 13 Ireland Designated Activity Company, Sfv Aircraft Holdings Ire 9 DAC Limited, Acg Aircraft Leasing Ireland Limited, Bluesky 19 Leasing Company Limited, GY Aviation Lease 1722 Co Limited, BOC Aviation (Ireland) Limited, Jackson Square Aviation Ireland Limited, Sky High Xcv Leasing Company Limited & Anr. Star Rising Aviation 13 Limited, Versus Union Of India & Anr. Directorate General Of Civil Aviation & Ors.</h3> Accipiter Investments Aircraft 2 Limited, Bluesky 31 Leasing Company Limited, Eos Aviation 12 (Ireland) Ltd., Pembroke Aircraft Leasing 11 Limited, Smbc ... Issues Involved:1. Deregistration of Aircraft by DGCA.2. Jurisdiction of High Court under Article 226 of the Constitution vis-Ã -vis NCLT.3. Nexus between Deregistration and Insolvency.4. Applicability of Cape Town Convention and Protocol.5. Retrospective or Prospective effect of MCA Notification dated 03.10.2023.6. Possession of Aircraft with Go Air.7. Impact of Delay in MCA Notification.Summary:1. Deregistration of Aircraft by DGCA:The principal grievance of the Petitioners/Lessors is that the Respondent/DGCA has failed to deregister their Aircraft(s) in contravention of Sub-Rule (7) of Rule 30 of the Aircraft Rules, 1937. Rule 30(7) mandates deregistration within five working days upon receipt of the necessary documents, including IDERA. The High Court directed DGCA to process the deregistration applications forthwith, stating that the function of DGCA to deregister the Aircraft is a 'ministerial act' and must be carried out mandatorily.2. Jurisdiction of High Court under Article 226 of the Constitution vis-Ã -vis NCLT:The High Court held that NCLT, being a creature of a special statute, cannot exercise the power of judicial review over administrative actions. The NCLT can only exercise powers within the contours of jurisdiction as prescribed by the statute. The High Court has the power to issue a writ of mandamus where a public authority has failed to exercise its powers as per the statute.3. Nexus between Deregistration and Insolvency:The High Court found no direct nexus between the deregistration of Aircraft and the insolvency of Go Air. The termination of Lease Agreements was due to continuous defaults in payment of lease rentals, which occurred much before the insolvency proceedings. The Court distinguished the case from the Gujarat Urja case, where the termination was solely due to insolvency.4. Applicability of Cape Town Convention and Protocol:India acceded to the Cape Town Convention and Protocol on 31.03.2008. The High Court held that the provisions of the Cape Town Convention and Protocol apply to the Aircraft in question. Rule 30(7) of the Aircraft Rules, which incorporates the Cape Town Convention and Protocol, mandates deregistration upon fulfillment of certain conditions.5. Retrospective or Prospective effect of MCA Notification dated 03.10.2023:The High Court held that the MCA Notification, which exempts aircraft, aircraft engines, and airframes from the moratorium under Section 14(1) of the IBC, is retrospective in nature. The Notification is a necessary adjunct to Section 14(1) of the IBC and must be given effect from the date the section came into force, i.e., 28.05.2016.6. Possession of Aircraft with Go Air:The High Court held that the Aircraft ceased to be in the possession of Go Air upon termination of Lease Agreements, which occurred before the moratorium was imposed. Therefore, the Aircraft cannot be covered under Section 14(1)(d) of the IBC, which deals with the possession of assets during the moratorium.7. Impact of Delay in MCA Notification:The High Court held that the delay in issuing the MCA Notification cannot nullify the legislative mandate of the enactment. The Notification, being procedural and a necessary adjunct to the statute, should be given retrospective effect. The Court emphasized that international treaty obligations must be strictly followed to avoid adverse effects on the country's business interests.Directions:1. The impugned rejection letters/communications issued by DGCA declining to process the Deregistration Applications are set aside.2. DGCA is directed to process the Deregistration Applications within five working days.3. All maintenance tasks with respect to the Aircraft shall be undertaken by the Petitioners/Lessors until deregistration and export.4. DGCA and AAI shall aid and assist the Petitioners/Lessors in accessing the Airports where the Aircraft are parked.5. Go Air and its representatives are restrained from accessing or operating the Aircraft.6. Go Air is restrained from removing any parts or documents from the Aircraft.7. Go Air shall provide up-to-date information and documentation in relation to the Aircraft to the Petitioners/Lessors.8. Petitioners/Lessors in certain cases are permitted to export the Aircraft subject to compliance with the Aircraft Act, Aircraft Rules, and applicable laws.9. The applications for impleadment of the Committee of Creditors (CoC) are dismissed.
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