NCLT orders insolvency process at Air Costa

The National Company Law Tribunal (NCLT) has ordered the commencement of the corporate insolvency resolution process for the grounded South Indian low-cost air carrier Air Costa. The airline is the second private airline after Jet Airways to undergo the debt resolution process. The airline, owned by Vijayawada-based LEPL Projects, was grounded in June 2017 after it failed to make payments for lease of aircraft engines to German aircraft maintenance firm MTU Maintenance Berlin-Brandenburg GmbH. However, as per the operator, it was solvent and had strong fundamentals but alleged that the German company supplied defective engines, that too after a delay, causing losses to the carrier.

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