Go First, an ultra-low-cost airline based in Mumbai, has revealed that it will be applying for voluntary insolvency resolution proceedings before the National Company Law Tribunal (NCLT). This announcement comes as the airline faces a severe cash crunch.
The airline cited the “serial failure” of Pratt & Whitney engines as the reason behind grounding 50% of its fleet, which eventually led to latest cash crunch. This pushed the low-cost airline to a situation where it cannot to fulfill its financial obligations.
To address this situation, Go First has decided to suspend all its flights for at least three days, starting from May 3. The airline has expressed regret for the inconvenience caused by the flight cancellations and has issued an apology to its customers through its website. The airline has canceled all flights scheduled for May 3, 4, and 5, 2023, due to “operational reasons”.
This article will examine the response of the airline regarding refunding customers who have already booked their tickets, whether through the airline’s website or third-party websites, and explore how they can receive a complete refund of their money.
Refund Process for Direct Bookings through Go First’s Website
Customers who have made their bookings directly through the Go First airline’s website will receive a refund, which will be credited back to the original mode of payment used for the booking.
The airline has assured customers that they will be kept informed about the progress of the refund process. In a statement, the airline expressed gratitude for their customers’ patience and cooperation during this challenging time.
Refunds for Bookings Through Online Travel Aggregators
The airline has stated that customers who have made bookings through online travel aggregators will receive a refund in their source account. In the event that a refund is not issued, customers can reach out to the online travel aggregator for further details.
Ticket Rescheduling and Transfer
Go First has explicitly stated that it is not possible to reschedule or transfer tickets to any other airline due to operational issues. The airline has expressed regret for any inconvenience caused to passengers as a result of flight cancellations and has stated that it is unable to reschedule or transfer their tickets.
Additionally, the airline has informed customers that they cannot make any changes or special requests to their existing bookings. It is important for customers to note that Go First will only issue refunds for cancelled flights, which will be credited to their source accounts.
Go First’s Liabilities and Financial Situation
Go First, the Mumbai-based low-cost airline, is facing liabilities of almost Rs 9,000 crore. The airline has reported a loss of around Rs 1,800 crore in the financial year ending March 2023, including a Rs 800 crore notional loss due to accounting standards.
In the last three years, the promoters have invested Rs 3,200 crore to keep the airline afloat, with Rs 2,400 crore injected in the last 24 months. The company received Rs 290 crore in April this year, bringing the total investment in the airline since its inception to approximately Rs 6,500 crore.
Furthermore, Go First also received nearly Rs 1,000 crore from the government’s Emergency Credit Line Guarantee Scheme (ECLGS).