Aviation regulator DGCA on Saturday suspended the flying licence of beleaguered Kingfisher Airlines for failing to come up with a viable plan for its financial and operational revival and resolve the impasse withits employees over payment of their salary dues.
Beleaguered Kingfisher Airlines on Wednesday faced fresh trouble with its employees deciding to move court seeking a formal closure of the company if it did not spell out future plans giving a time-line for clearing their salary dues of eight months.
Maintaining that the management was working to get fresh investment 'in the next few months', the Kingfisher CEO said no potential investor would put money in an airline that was not operational and neither would passengers return till operations commenced.
This is the second time since February 2 that the cash -strapped carrier has been suspended from ICH for not paying its dues.
Beleaguered Kingfisher Airlines on Monday virtually blamed the Income Tax authorities for the large-scale flight disruptions, saying freezing of its bank accounts by them had "severely affected" payment schedules that had led to the curtailment in its services.
The notice for clearing the dues, served 10 days ago, gave the airliner 7 days time to make the payment but it has not yet responded, Mumbai International Airport Limited sources told PTI on Monday.
The consortium of 17 banks, led by SBI, has an outstanding of over Rs 7,000 crore (Rs 70 billion) from the carrier.
Beleaguered Kingfisher Airlines on Wednesday announced further reduction in its flight schedule and said its promoter Vijay Mallya will meet the pilots agitating over delayed salary on Thursday.
The airline has suspended all operations till Thursday.
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The controversy over a DGCA note on beleaguered Kingfisher Airlines refused to die down with new DGCA chief Prashant Sukul saying there was no such document and his predecessor E K Bharat Bhushan seeking a probe into whether it was removed from the official file.
The grounded airline owes Rs 290 crore (Rs 2.9 billion) to AAI towards landing and parking fees.
On Saturday, bankers met the KFA management in yet another inconclusive meeting.
Faced with a cash crunch resulting in several employees not getting salaries and dues for over three months, the airline also did not rule out a lay off.
Bank chiefs have been quoted as saying that Kingfisher would need to arrange fresh equity of Rs 1,000-2,000 crore (Rs 10-20 billion) before seeking additional funds from the consortium of banks, led by the State Bank of India.
While Air India owes Rs 450 crore (Rs 4.5 billion), beleaguered Kingfisher Airlines has unpaid dues of Rs 75 crore (Rs 750 million) and both carriers have been put on the cash-and-carry mode of payment.
SBI has the highest exposure of Rs 1,600 crore to the beleaguered Kingfisher Airlines.
'Mallya has offered to pay the original amount.' 'Let us say he means the principal amount and that stands at Rs 5,000 crores.' 'The Indian banks have to ask themselves if they would rather have this 5,000 crores or would have none of it at all,' asks Sudhir Bisht.
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