Avantika, Campus Law Centre, Faculty of Law, Delhi University
ABSTRACT
This article presents a comprehensive analysis of the evolving landscape of airline insolvencies in India, juxtaposing the treatment of aircraft lessors before and after the enactment of the Insolvency and Bankruptcy Code of 2016 (‘IBC’). The article delves into landmark cases, notably the Kingfisher Airlines case, to illustrate the challenges faced by lessors in the absence of a streamlined legal framework. Transitioning to the post-IBC regime, the article meticulously dissects the treatment of aircraft lessors under the IBC, emphasizing the dichotomy between the IBC's moratorium provisions and the internationally recognized Cape Town Convention. Furthermore, the article casts a spotlight on recent developments, particularly the Go Airlines insolvency case, which sheds light on the interplay between the IBC and the Cape Town Convention, along with its Aircraft Protocol, spotlighting the clash between the IBC's moratorium period and the imperative for aircraft deregistration as stipulated by the Cape Town Convention. This clash creates a complex scenario, where the moratorium's protection conflicts with the need to maintain the value of aircraft assets and safeguard lessors' interests. By encompassing these critical cases and legislative frameworks, the article underscores the need for a harmonious legal approach that considers the unique complexities of airline insolvencies while aligning with international treaty obligations. It emphasizes implementation of Cape Town Convention and Protocol, highlighting the benefits of a streamlined process for asset recovery, deregistration, and cross-border enforcement of creditor rights.
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