30 Kingfisher flights either cancelled or clubbed

Trouble for cash-strapped Kingfisher Airlines again erupted today with at least 30 flights either being cancelled or clubbed as several pilots and other staffers failed to report for work to protest delays in salary payments.

At least 13 flights from Mumbai were cancelled, while reports said there was no operation from Kolkata today. Nine departures from Delhi were also either cancelled or clubbed, airport sources said, adding only three direct flights each way were available on the busiest Mumbai-Delhi sector which has seven daily services.

Acknowledging disruption in its schedule, an airline spokesperson told PTI that some flights "are being cancelled as a result of employee agitation on account of delayed salaries".

"The flight loads have reduced because of our limited distribution ability caused by IATA suspension," he said, adding that this situation had arisen because of "our bank accounts having been frozen by the tax authorities".

The spokesperson said the airline would operate "approximately 80 per cent of our planned flight schedule" while maintaining, "We are making all possible efforts to remedy this temporary situation".

Badgered from all sides, Kingfisher was last week suspended for non-payment of dues from three IATA platforms affecting its passenger and cargo bookings through agents.

The International Air Transport Association (IATA) had suspended it from participating in its Clearing House, Billing and Settlement Plan (BSP) and Cargo Accounts Settlement System (CASS).

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BSP and the CASS programmes facilitate and simplify the sale of tickets and booking of cargo through travel and freight agents, both domestic and international. The suspension from the BSP and the CASS means that the airline would not be able to use these platforms to settle its sales and bookings with the IATA-recognised travel and cargo agents.

Kingfisher's suspension from the IATA Clearing House (ICH) implied that it would not be able to settle accounts for services provided to them by other airlines or related companies.

The freezing of the airline's bank accounts by the income and service tax authorities, as also by customs and excise department, has dealt a severe blow to it, by squeezing its liquidity position.

The airline was hit hard on Saturday when state-run HPCL stopped jet fuel supplies, causing some cancellations and delays to some other flights. Fuel supplies were, however, resumed on Sunday. Kingfisher owes Rs 515-520 crore (Rs 5.15-5.2 billion) in fuel bills along with interest.

Kingfisher, which reported a net loss of Rs 444.26 crore (Rs 4.44 billion) in the December quarter, has never made a profit since inception in May 2005. It suffered a loss of Rs 1,027 crore (Rs 10.27 billion) in 2010-11 and has a debt of Rs 7,057.08 crore (Rs 70.57 billion).