Kingfisher suspended from two more IATA platforms

Badgered from all sides, Kingfisher Airlines was on Friday, suspended for non-payment of dues from two more IATA platforms that would affect its passenger and cargo bookings through agents, but the cash-strapped carrier said it has made alternative arrangements for these bookings.

International Air Transport Association (IATA), which had suspended it from its Clearing House on Wednesday, said Kingfisher has been suspended from participating in the global airline body's Billing and Settlement Plan (BSP) and Cargo Accounts Settlement System (CASS).

"The suspension was because the airline did not provide IATA with a cash deposit, required to continue its participation in the BSP and the CASS. The required cash deposit was intended to ensure the airline is able to meet its financial obligations in the BSP and the CASS," an IATA spokesperson said in a statement from Singapore.

The BSP and the CASS programmes facilitate and simplify the selling, reporting and remitting procedures between airlines and travel and cargo agents, both domestic and international.

The IATA spokesperson said 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 IATA-recognised travel and cargo agents.

"The airline is still free to sell and settle directly with travel agents and freight forwarders," he said, adding that Kingfisher's participation in the BSP and the CASS would be reinstated "after the airline fulfills the cash deposit requirement."

Two days ago, the IATA had suspended the beleaguered carrier on the same grounds from the IATA Clearing House (ICH) through which airlines and related firms settle accounts for services provided by them to other such companies. 

Responding to the suspension, a Kingfisher spokesperson said, "The airline has made alternative arrangements to ensure that the customers can continue to book their travel on Kingfisher, via select leading travel agents and their network of partners.

"In addition, they can continue to book and purchase tickets either via our website or through any of the Kingfisher Airlines ticketing offices across India and at international locations and our call centres".

The spokesperson said this situation has arisen because of the freezing of the airline's bank accounts by the tax authorities.

"We are making all possible efforts to remedy this temporary situation. We would like to emphasize that all our flights will continue to operate normally as per the schedule published on the website," the spokesperson added. The carrier is operating 200 flights, instead of over 400 for which it had sought permission to fly in the Winter Schedule from October till March, to 46 domestic and international destinations.

The airline, which is struggling to remain afloat, 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, which owes Rs 515-520 crore in fuel bills along with interest, had not been honouring its daily fuel bills, prompting the oil PSU to snap supplies.

A large number of its bank accounts have been frozen by the income tax, service tax and excise and customs departments for its failure to clear dues.

The airline has been told by its bankers that it should first infuse at least 25 per cent of the Rs 3,000 crore loan it is looking for in the form of fresh equity. Other vendors like Airports Authority of India have put Kingfisher on a 'cash-and-carry' mode for providing aeronautical services.

The airline, which never made a profit since inception in May 2005, reported a net loss of Rs 444.26 crore in the December quarter. It suffered a loss of Rs 1,027 crore in 2010-11 and has a debt of Rs 7,057.08 crore.