Latest developments in insolvency and bankruptcy in India

Go First Airlines

Go First Airlines files for insolvency: On May 4, 2023, the NCLT Delhi reserves order on a request for an interim moratorium.

On May 2, 2023, Nusli Wadia promoter of Go Air approached the Hon’ble National Company Law Tribunal (NCLT) and file petition seeking insolvency. A few years earlier, Jeh Wadia had been ousted because the airline was consistently losing money. When Nusli took over as CEO, the severe rivalry was too much for the airline to handle, and it couldn’t be saved. It is to be seen who will purchase this airline through NCLT.

On May 4, 2023, the NCLT heard the request for an interim moratorium and reserved its order. According to their insolvency filings, the airline has a debt of 65.21 billion rupees and the financial creditors of Go First include Central Bank of India Ltd, Bank of Baroda Ltd, IDBI Bank Ltd, Axis Bank Ltd, and Deutsche Bank.

Credit Suisse

Credit Suisse writes to Resolution Professional of Reliance Capital to postpone discussions on the Resolution Plan of Hinduja-backed IIHL.

Credit Suisse AG, Mumbai branch, is the onshore security trustee for Reliance Capital’s lenders Credit Suisse AG, Singapore branch, Federal Bank, and Far Eastern International Bank. Their claim of approximately Rs. 660 Crores was rejected by the Resolution Professional of Reliance Capital.

Credit Suisse had petitioned the NCLT for directions in response to the resolution professional’s rejection of their Rs. 660 crore claim. In a letter by their lawyer to the Resolution Professional, they requested that any discussions and negotiations on the Resolution Plan of the sole Prospective Resolution Applicant, i.e. Hinduja-backed IndusInd International Holdings (IIHL), be postponed until the Mumbai Bench of the NCLT rules on their application against the decision to reject their claim.

Insolvency and Bankruptcy Board of India

Insolvency and Bankruptcy Board of India (IBBI) exercising powers under Section 240 of the Insolvency and Bankruptcy Code, 2016 in a press release on 04 May 2023 have invited comments from the public at large on all the notified regulations under the IBBI. These recommendations and comments are invited through a portal on the IBBI website which will allow various stakeholders such as corporate debtors, creditors insolvency professionals, insolvency professional agencies, insolvency professional entities, personal guarantors to corporate debtors, proprietorship firms, partnership firms, academics, investors and other.