Kingfisher flies into fresh trouble, as tax fiat jolts Jet

30 Kingfisher flights cancelled or clubbed as employees protest salary payment delays

March 12, 2012 02:25 pm | Updated November 17, 2021 12:22 am IST - New Delhi

The crisis-ridden Kingfisher Airlines ran into fresh trouble on Monday, with at least 30 of its flights having been either cancelled or clubbed as several pilots and other staff members did not report for duty to protest against delays in salary payment, even as the tax authorities acted against Jet Airways to recover dues.

At least 13 flights from Mumbai were cancelled and operations from Kolkata affected. Nine flights from Delhi were either cancelled or clubbed, sources at the airport said.

A spokesperson of the airline said some flights were cancelled as a result of an employee agitation “on account of delayed salaries.” “The flight loads have reduced because of our limited distribution ability caused by the IATA suspension.”

(Last week, the airline was suspended from three settlement systems of the International Air Transport Association (IATA), the global airlines body.)

The spokesperson attributed the current situation to the freezing of bank accounts by the tax authorities. The airline would operate “approximately 80 per cent of our planned schedule.”

“We are making all possible efforts to remedy this temporary situation. We will operate approximately 80 per cent of our planned schedule. We expect to return to our full schedule shortly. Those guests whose flights are affected are being notified. They are either being accommodated on other airlines or offered a full refund,” the spokesperson said.

Meanwhile, the top private carrier, Jet Airways, got a rude shock from the Service Tax Department's directive to the IATA to pay up the airline's tax dues of Rs. 69 crore before settling its bills.

Officials of the Central Board of Excise and Customs confirmed that the Service Tax Department had sent the directive. The payment had been due since March 6. Then, Jet Airways had said it would clear the dues by Monday.

Confirming the action, a Jet Airways spokesperson said: “The Service Tax Department has been in touch with the IATA with regard to having their proceeds remitted when the collections are remitted to Jet Airways.” But “no bank account of the airline has been frozen or attached.”

The IATA maintains accounts to enable airlines to transact business with their counterparts, travel and cargo agents and other vendors, in domestic as well as international markets.

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