Accipiter Investments v. Union of India: the Go First lessors, the moratorium, and the five-day deregistration order

When Go First grounded its fleet and filed for voluntary insolvency in May 2023, the moratorium that followed under Section 14 of the Insolvency and Bankruptcy Code did something that moratoria are not supposed to do: it froze the ability of aircraft lessors to recover aircraft that Go First did not even own. The fifty-odd aircraft flying the airline's colours belonged, in law, to a scattering of international leasing companies — Accipiter Investments Aircraft 2 Limited among them — who had already terminated their leases for non-payment before the airline ever walked into the National Company Law Tribunal. What followed was almost a year of litigation before the Delhi High Court, running from urgent interim applications in mid-2023 through to Justice Tara Vitasta Ganju's order of 26 April 2024, which finally told the Directorate General of Civil Aviation to get on with deregistering the aircraft.

The facts, across the order-chain

Go First (formerly GoAir) filed for insolvency under Section 10 of the IBC in early May 2023; the NCLT admitted the petition and imposed the Section 14 moratorium on 10 May 2023. The moratorium's ordinary effect is to freeze recovery actions against "the assets of the corporate debtor" while a resolution plan is worked out. The difficulty in this case was definitional: the aircraft were not Go First's assets. They were leased, and the lessors — Accipiter among a group that included Pembroke Aircraft Leasing, SMBC Aviation Capital and others — had terminated those leases for rental default in the days immediately before the insolvency filing, invoking their contractual right to repossess. Termination, on the lessors' case, had already occurred; what remained was the ministerial act of deregistering the aircraft with the DGCA under the Irrevocable De-Registration and Export Request Authorisation (IDERA) each lessor held, so that the aircraft could be exported and re-leased elsewhere.

The DGCA, however, declined to process the deregistration applications, effectively treating the moratorium as a bar on its own statutory function under Rule 30(7) of the Aircraft Rules, 1937. Aggrieved, the lessors moved the Delhi High Court by writ petition (the lead matter carrying the cause title Accipiter Investments Aircraft 2 Limited v. Union of India & Anr.) in May 2023. Through the rest of 2023 the litigation proceeded in stages rather than as a single hearing: the Single Judge passed a series of interim orders permitting lessors access to airports for inspection and routine maintenance of their aircraft even while the deregistration question remained pending, and the resolution professional's attempts to resist those interim measures were tested before a Division Bench before the matter returned to the Single Judge for final disposal. Layered onto this timeline was a legislative intervention: on 3 October 2023, the Ministry of Corporate Affairs notified an exemption carving aircraft, aircraft engines, airframes and helicopters covered by the Cape Town Convention out of the reach of the Section 14 moratorium — a change plainly aimed at resolving exactly the standoff this litigation had exposed. It was against that backdrop that Justice Ganju delivered the 26 April 2024 order disposing of the batch of petitions.

The question

Two questions were bound together. First, could the DGCA lawfully withhold deregistration of aircraft whose leases had already been terminated, on the footing that the aircraft remained in the insolvent airline's possession and the moratorium was in force? Second, what was the effect of the October 2023 MCA notification on leases and terminations that had occurred before the notification was issued — was it merely prospective, leaving the pre-notification standoff unresolved, or did it speak to and validate the position the lessors had been asserting all along?

What the Court held

The Court held that the NCLT's jurisdiction under Section 60(5) of the IBC — the provision the resolution professional leaned on to argue that all questions touching the corporate debtor's affairs belonged before the Tribunal — did not extend to compelling a public authority like the DGCA to act contrary to its own statutory rules. The DGCA's function under Rule 30(7) is mandatory once the prescribed conditions (proof of termination, IDERA, and the accompanying certifications) are met; it is not a discretion that bends to the convenience of a corporate debtor's insolvency proceedings. Because the lease terminations here predated the insolvency commencement, the aircraft were never assets that fell within the moratorium's protective sweep in the first place.

The Court's framing was that the inconvenience of a particular party — however commercially significant — cannot displace what the statutory scheme plainly requires.

On the second question, the Court read the October 2023 MCA notification as declaratory of the legal position rather than as a purely prospective change that left the pre-October standoff untouched — treating it as confirming, for aircraft leasing generally, the very reading of Section 14 that the lessors had been pressing since May 2023.

Analysis

The judgment sits at the intersection of two systems that do not naturally speak to each other: India's domestic insolvency code, built around collective proceedings and a debtor-protective moratorium, and the Cape Town Convention's asset-specific regime, built around a creditor's near-absolute right to recover mobile equipment on default. The Convention and its Aircraft Protocol exist precisely because aircraft financing depends on lessors being able to price in fast, predictable repossession; a jurisdiction that lets a domestic insolvency moratorium override IDERA rights indefinitely tells the leasing market that its Cape Town commitments are unreliable in practice, whatever the treaty text says. The Court's finding that leased, already-terminated aircraft simply never entered the insolvency estate is doctrinally the cleanest way to avoid that collision: it does not require carving an exception into Section 14 so much as recognising that Section 14 was never triggered on these facts.

That said, the order cannot be read in isolation from the October 2023 notification, and the judgment is candid about that dependency — the DGCA's established practice of treating moratoria as a reason to freeze deregistration had, by the government's own admission in notifying the carve-out, created a gap serious enough to warrant a rule change. The same tension between statutory moratorium and property rights recurs across India's insolvency jurisprudence in different guises, whether it is provident fund dues surviving a moratorium in the NCLAT's ruling in Sunil Kumar Jain v. EPFO, or the Supreme Court holding that certain sovereign or public-trust assets sit outside the insolvency estate altogether in State Bank of India v. Union of India. What unites them is a judicial willingness to ask, before applying Section 14 mechanically, whether the thing being frozen was ever properly part of the corporate debtor's estate to begin with.

Why it matters

For aircraft lessors and their financiers, the order is a reassurance that Indian courts will not let a domestic insolvency filing become a backdoor override of Cape Town Convention rights, at least where the lease has already been terminated before the moratorium bites. That matters commercially: the Court itself noted that the DGCA's earlier inertia had contributed to a measurable slide in India's Cape Town Convention compliance rating, a metric that leasing companies and their insurers factor directly into the pricing of aircraft placed with Indian carriers. A jurisdiction perceived as unreliable on repossession pays for it in higher lease rates across the board, not just for the airline in distress.

For resolution professionals and distressed airlines, the lesson cuts the other way — the moratorium is not a universal shield, and assets that were never the debtor's to begin with cannot be locked up simply because they sit on the debtor's tarmac. And for regulators, the episode is a case study in how litigation and rulemaking can move in tandem: the DGCA's practice, the lessors' writ petitions, and the MCA's October 2023 notification together produced a settled position faster than any one of those tracks could have done alone, with the April 2024 order supplying the judicial seal on a fix the government had already signalled it wanted.

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Sources

• LiveLaw, "Go First Case: Delhi High Court Directs DGCA To Process De-Registration Of Leased Aircrafts"
• SCC OnLine Blog, "'Inconvenience of specific party cannot outweigh statutory provisions'; Delhi High Court directs DGCA to process deregistration of 54 leased GoAir aircrafts"
• Verdictum, "Deregistration Of Planes Of Go First Aircraft: Delhi High Court Lists Case For Hearing Today"
• Bar & Bench, "Interplay between IBC and MCA Notification: Balancing Lessors' Interests and Airline Revival"