On Wednesday, India’s fourth-largest airline, Go Airlines (India) Ltd., and its 7,000 workers will face a bankruptcy plea judgment that would affect overseas lessors attempting to repossess planes.

The low-cost carrier, recently rebranded Go First, blamed its financial woes on “faulty” Pratt & Whitney engines that grounded half its 54 Airbus (AIR.PA) A320neos. The engine maker, Raytheon Technologies (RTX.N), denies the accusations.

If the Indian judiciary accepts Go First’s case, a new resolution specialist will govern Wadia Group’s airline to renew it. Go First should win around 10:30 a.m. (0500 GMT).

Indian airlines have never deliberately sought bankruptcy protection to restructure contracts and obligations.

The great action might hinder lessors’ efforts to seize approximately 40 Go First planes over late rental payments.

Lawyers and industry insiders claimed Indian law bars such recovery after a firm enters bankruptcy.

After joining the Cape Town Convention, India makes it simpler for lessors to take back planes if airlines default.

Lawyers argued India’s bankruptcy law would overrule lessors’ repossession requests due to the treaty’s lack of enforcement.

“Lessors must be extremely worried.” “The repossession requests will be of no consequence if the insolvency and bankruptcy process kicks in,” said Abhirup Dasgupta, an insolvency law partner at HSA Advocates who is not engaged in the Go First situation.

Two industry insiders advised some lessors that Go First’s insolvency may require them to initiate lengthy litigation to seize planes.

One source said lessors are worried about stranding their assets in the nation with little certainty on repossession, which might lead to increased lease rates for Indian airlines.

Industry sources were not authorized to discuss the topic publicly.

Go First’s lessors include Jackson Square Aviation, SMBC Aviation Capital, and CDB Aviation’s GY Aviation Leasing worldwide.

Go First, which had a nearly 8% market share in the world’s third-largest aviation sector, was grounded as Indian Prime Minister Narendra Modi promoted the country’s aviation dominance.

As domestic air traffic in India exceeds pre-pandemic levels, bigger rivals IndiGo (INGL.NS) and Tata Group’s Air India are planning massive growth with hundreds of new planes.

Two industry sources claimed several lessors had begun talks with IndiGo and Air India to take over Go First’s planes. Still, it is unclear how the tribunal’s judgment on Wednesday will affect such negotiations. IndiGo declined to comment. Air India didn’t reply. Go First would follow Jet Airways and Kingfisher, which collapsed in 2019 and 2012.