Closing down not an option, says Mallya

Vijay Mallya

Beleaguered Kingfisher Airlines' promoter Vijay Mallya on Monday night said he would not shut down the private carrier, which struggled to stay afloat after further large-scale flight disruptions and resignation of pilots.

“Closing down is not an option. It will not happen.The government does not want it to happen. It is not in the national interest,” Mr. Mallya said in his first public reaction to the latest crisis that had gripped his cash-strapped airline.

‘Help, not bailout'

“Why should we give up as long as we get help? Help is not bailout. We have asked banks to consider our proposal to provide more working capital,” he said, making it clear that the airline had never sought a bailout from the government.

In the context of getting help, the liquor baron referred to the government's decision to allow direct jet fuel imports by the airline and permit foreign carriers to pick up stake in them. He had lobbied hard with the government on both these issues.

Mr. Mallya claimed that the entire issue of bailout was of the “media's making.”

Asked about sudden disruption in Kingfisher flights, the UB Group chief said the bank accounts of the airline were frozen “very suddenly” by the Income Tax authorities over non-payment of tax dues.

“The abrupt disruption was unfortunate because our bank accounts were suddenly frozen by tax authorities. I don't deny we have taxes due. The bottom line is we requested for time to pay these dues,” Mr. Mallya said.

“It was the very sudden attachment of our accounts that obviously crippled us,” he said.

Kingfisher, which suffered a loss of Rs 1,027 crore in 2010-2011 and has a debt of Rs. 7,057.08 crore, posted a Rs. 444 crore loss in the third quarter this fiscal.