The Civil Court has ruled in favour of the Maldives Inland Revenue Authority (MIRA) in its case against GoAir, ordering the Indian airline to pay USD 3,580,588 within one month. The verdict, delivered on the 3rd of this month, mandates the payment to cover unpaid airport service charges, departure taxes, and airport development fees.
Background of the Case
In June 2023, India’s budget carrier GoAir filed for bankruptcy, suspending its flight operations to the Maldives. According to the Maldives Airports Company Limited (MACL), GoAir halted its direct flights to the Maldives in April. GoAir’s bankruptcy filing followed its failure to meet debt obligations amounting to USD 1.4 billion.
Court Proceedings and Ruling
The court said that despite being duly notified, GoAir did not respond to the charges or appear in court to defend itself. It noted that all necessary documents were sent to the airline, but no defence was filed within the stipulated timeframe. Consequently, the court proceeded in the airline’s absence, ruling decisively in favour of MIRA.
The court order obligates GoAir to settle the total amount within a month from the 3rd of this month.
MIRA initiated legal proceedings against GoAir, citing unpaid fees and taxes related to the airline’s operations. The chargesheet detailed various fees accrued since 2022, including:
- Departure Tax:
- $30 per foreign passenger in economy class
- $12 per domestic passenger in economy class
- $60 per passenger in business class, both foreign and domestic
- $90 per passenger in first class, both foreign and domestic
- $120 per passenger on private jets, both foreign and domestic
- $30 per foreign passenger in economy class
- Airport Development Fee:
- $25 per foreign passenger in economy class
- $12 per domestic passenger in economy class
- $60 per passenger in business class, both foreign and domestic
- $90 per passenger in first class, both foreign and domestic
- $120 per passenger on private jets, both foreign and domestic
- $25 per foreign passenger in economy class
These fees, particularly departure taxes, are applied to all passengers leaving the Maldives, a key source of revenue for the nation’s airports.
Go Air’s Bankruptcy
The airline had already faced turbulence during the COVID-19 pandemic, suspending all international flights in March 2020.
In May 2021, GoAir rebranded itself as Go First, and later that year, it planned an initial public offering (IPO) to raise USD 430 million.
In 2023, GoAir encountered significant operational challenges due to issues with the availability of Pratt & Whitney engines, which power its entire fleet of A320 aircraft.
This disruption led to the suspension of operations in May 2023, prompting the airline to file for voluntary insolvency.
After filing for bankruptcy, leasing companies repossessed GoAir’s leased planes due to unpaid rental dues. The airline’s total dues, including claims from vendors and lessors, amounted to US D1.4 billion.
Since filing for bankruptcy, lessors have been battling to regain control of their aircraft from the airline’s former owner, lenders, and the resolution professional.
