Kerala HC Refuses To Modify Its Order Directing DGCA To Suspend Ticket Booking Portals Of GO Airlines After Due Verification

The Kerala High Court has refused to allow an application filed by Go Airlines to modify its interim order passed on May 5, 2023, by which the Directorate General of Civil Aviation (DGCA) was directed to verify whether Go Airlines had made a statement pursuant to filing proceedings before the NCLT for insolvency that it would temporarily suspend flight operations, and to direct the Airlines to suspend its ticket booking portals and stop their agents from taking any flight bookings if such statement had been made. 

Senior Advocate Joseph Kodiathara appeared for the Airlines while the writ petitioner appeared in person. 

The Single Judge Bench of Justice PV Kunhikrishnan observed in the order-"This petition is filed to modify order dated 05.05.2023. This Court only directed the 2nd respondent to check the fact and if the facts mentioned in the order is found to be correct, the 2nd respondent was directed to issue directions to the 3rd respondent to suspend its ticket booking portals and to stop their agents from taking any flight bookings. In such circumstances, no modification of the order is necessary."

Further, asking the Go Airline to approach the DGCA, the High Court ordered, "The petitioner is free to approach the 2nd respondent and convince him about their stand, and if such a request is received from the petitioner, the 2nd respondent will give an opportunity of hearing to the 1st respondent and pass appropriate orders in it, in accordance with law".

Background: A Writ Petition was filed by an Advocate Yeshwant Shenoy alleging that Go First Airlines suspended their operations by declaring voluntary insolvency and yet allowed their ticket booking platforms to book flights, resulting in daylight robbery and passengers losing their hard-earned money.

Shenoy had stated in his Petition that people have lost their hard-earned money to the Airline company as there will be no operations carried by Go First and that by further allowing the Airline company to keep its booking portals open, many people are falling prey to daylight robbery. It was also stated that the DGCA allowed the company to keep its booking portals open and failed to perform its obligations.

Considering the points raised in the matter, the Kerala High Court ordered that the DGCA will check this fact and if it is found to be correct, forthwith direct the Go Airline to suspend its ticket booking portals and to stop their agents from taking any flight bookings.

Being aggrieved by the same, the Go Airline approached the High Court seeking modification of this order. It was submitted that the ex-parte interim order was passed without giving any opportunity to them to be heard and is in violation of the principles of natural justice as the High Court passed it on the sole basis of pleadings put forth only by Petitioner-in-Person Yashwant Shenoy. 

Go Airlines further submitted that once a company is admitted into CIRP, a moratorium is declared and during the operation of the moratorium, inter alia, the company must be run as a going concern and no proceedings can be initiated or continued against the company. The Company said that so long as the interim order remains in operation and the booking portals remain shut, they will not be in a position to restart operations, thereby defeating the objective of revival enshrined under the Code.

"It is reiterated that Respondent No.3 has over 7,000 direct employees and 10,000 indirect employees and an aggregate outstanding debt of INR 2660 crores towards operational dues, as on 2 May 2023. Hence, the public interest in ensuring a revival of Respondent No.3 through the CIRP is manifest and severe prejudice would be suffered by all stakeholders if such public interest is overlooked at the instance of the Petitioner", read the IA filed by Go Airlines.

The High Court refused to modify the order and asked Go Airlines to approach the DGCA and convince them of their stand. Justice PV Kunhikrishnan further asked that if such a request is received by the DGCA from Go Airlines, the DGCA will give an opportunity of hearing to Yashwant Shenoy.

Cause Title: Go Airlines (India) Limited v. Yeshwanth Shenoy & Ors. [IA.NO.1/2023 IN WP(C) NO. 15297 OF 2023]

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