mediarockz: Mar 19, 2012

NEW DELHI: Ailing Kingfisher Airlines today faced the prospects of its flying licence being cancelled and its boss Vijay Mallya has been asked by DGCA to present a clear picture of the cash-strapped private carrier.

The Directorate General of Civil Aviation (DGCA) mulled cancellation of Kingfisher's flying permit after the airline today submitted to it the summer flight schedule with 15 to 16 aircraft as against 28 planes submitted last month.

"The airline not only lacks aircraft, they also lack funds for day-to-day operations. They are failing to meet their flight schedule, causing inconvenience to the passengers and also they failed to give salaries to their employees for past four-five months," official sources said. The sources said Kingfisher may be planning a quiet shutdown and Mallya being an "accountable" person has been asked to meet the DGCA to present a clear picture.

The whole picture is likely to become clear in few days, the officials said.

The beleaguered airline was served a show cause notice by the Civil Aviation regulator DGCA towards the end of February asking why its licence should not be suspended as it had made unannounced cancellations.

The 15-day mandatory notice period has already lapsed and they have failed to give a valid reason for curtailment of their flight schedule, most of their explanations are unsatisfactory and they have not given a definite recovery plan, officials said requesting anonymity said, adding the airline is presently operating only 15 or 16 aircraft.

Facing severe fund crunch, Vijay Mallya-promoted airline has decided to curtail its overseas flights operations to avoid further losses and also return of a leased aircraft.

According to sources, the airline has planned to suspend its overseas operations from March 25, except Delhi-London which it is withdrawing from April 9. Also the airline would return its wide body airbus A 330-200 aircraft to a lessor in the United Kingdom.

Struggling to stay afloat, around 60 accounts of Kingfisher Airlines have been frozen by the tax authorities for its failure to pay taxes after levying it from the passengers.

Angry over not being paid for four months, airline pilots reported sick, forcing the airline to curtail its scheduled flights. Mallya at a meeting with the pilots last Friday said their grievances would be looked into but did not set a time frame. He had also said the airline would come out with a crystal clear roadmap for its future in a few days.

Kingfisher has a total debt of about Rs 7,057 crore and accumulated losses of about Rs 6,000 crore.

Earlier this month, global airlines body IATA suspended Kingfisher for not clearing its dues.

This was the second time in just over a month that the airline was suspended on the same count from the IATA Clearing House (ICH) through which airlines and related firms settle accounts for services provided by them to other such companies.