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Kingfisher Airlines crisis deepens as talks fail

Published: 04th October 2012 10:30 AM  |   Last Updated: 04th October 2012 10:30 AM   |  A+A-

Kingfisher-Airlines

The crisis in cash-strapped air carrier, Kingfisher Airlines, deepened on Wednesday as the second round of talks between the management and the striking engineers and pilots over payment of salary backlog failed with the protestors turning down the offer of part payment and decided to continue their strike.

The failing of the talks is said to have forced aviation authorities to take a tougher stand on the matter which could result in prolonged shutdown of the airline. Reports suggest that pilots of the airline, who spoke to media persons after the meeting in Mumbai,  confirmed the stalemate between the two parties and also that they would not allow flights to operate until they (KfA) does so.

Kingfisher had maintained that they were unable to pay employee salaries due to the freezing of their accounts. But the airline management has now said  that they do not have any money for salary payments, even though an order to de-freeze their accounts has already been passed by the Karnataka High Court.

The HC in its order dated, 26-9-2012 had been stayed the IT departments efforts to recover the TDS dues by freezing the airline’s account. But the airline, in their last two meetings with protesting engineers and pilot have maintained that they do not have the money for payment of dues.

KfA is said to have offered to pay only one months salary as against the due of nearly 7 months. Earlier in many occasions, protesting pilots returned to work after KfA Chairman Vijay Mallya assurances to pay them after their accounts were ‘de-frozen’. But pilots refused to budge from their stand this time around.

KfA had filed a petition before the IT tribunal challenging the order of the department to freeze their accounts due to non payment of TDS amounting to Rs 342 crore.  Hearing the petition, the tribunal had set aside the order of the department, who later filed an appeal before the HC. Hearing the appeal from both sides, HC in its interim order stayed the tribunal judgement and order of the department. The hearing of the main plea is still pending before the HC.

KfA had reached an agreement with the IT department to pay Rs 9 crore towards settling the due amount, but the airline had made only a few part payments forcing the IT department to freeze the airline’s accounts.



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