The Directorate General of Civil Aviation (DGCA) on Saturday suspended the operating licence of the cash-strapped Kingfisher Airlines under provisions of the Aircraft Act, as it failed to convince the apex civil aviation regulator with a plan for financial and operational revival.
Suspension of its flying licence implies an immediate halt to all bookings on the entire KFA network as well as through travel agents.
“Kingfisher Airlines’ licence was suspended keeping in mind passenger safety,” Civil Aviation Minister Ajit Singh said on Saturday.
Owned by flamboyant liquor baron and billionaire Vijay Mallya, KFA is saddled with losses to the tune of `8,000 crore and a debt burden of `7,000 crore. A large part of the debt has not been serviced by Mallya since January.
The airline failed to pay its employees in the past six months, owes crores to different airport operators and oil companies and has been facing a lock-out since October 1 after its employees struck work demanding their pending wages.
Asked why the license was suspended, the officials said the government did not want a situation where the airline, which was on cash-and-carry mode for almost all service providers, re-starts operations and then keeps flying in fits and starts, as has been happening since last year-end. Since it started operations in May 2005, the airline has never made profit. It suffered losses to the tune of `1,647 crore in 2009-10, `1,027 crore in 2010-11 and `732 crore in 2011-12.
