By BS Reporter
Bad times have befallen the King of Good Times. After weeks of uncertainty over Kingfisher Airlines ' future, the Directorate General of Civil Aviation (DGCA) on Saturday decided to suspend its licence. The move came after the airline failed to come out with a viable operational and financial revival plan, for which it had been given an October 20 deadline.
The suspension does not have a defined term and can be revoked once the DGCA is satisfied the airline has a financial and operational plan to ensure the safety of flights.
The suspension comes after KFA (Kingfisher Airlines) failed to reply to a showcause notice issued by the DGCA, asking why its license should not be cancelled. KFA sought more time to respond, which was denied.
|WHAT LED TO THE FALL|
|Total debt||Rs 13,446 crore, including bank debt (approximately Rs 5,940 crore), promoter debt, trade debt and other short-term liabilities|
|Accumulated losses||Rs 10,260 crore as on June 30, 2012|
|Promoter contribution||Approaching Rs 5,400 crore as on August 31, 2012 as well as UB Group securities, of which Rs 1,188 crore has been infused in the past 3-4 months|
|Source: CAPA (Centre for Asia Pacific Aviation)|
According to a statement by the civil aviation ministry, "The permit has been suspended with effect from October 20, 2012, pursuant to Clause 15 (2) of Schedule XI of the Aircraft Rules, 1937. It has been suspended till such time KFA submits a concrete revival plan ensuring safe, reliable, efficient and sustainable scheduled air transport services to the satisfaction of the DGCA."
Responding to the decision, Ajit Singh, civil aviation minister, said, "We cannot compromise passenger safety. DGCA has given enough time to KFA. It will have to come up with a satisfactory operational preparedness plan. It will have to ensure that KFA employees are not disgruntled."
|THE JOURNEY TO THE CRASH|
A spokesperson for the airline said the suspension was temporary. "The actual position has not changed because of this order. We have in any case always maintained that once the issues with the employees are resolved, we will present our resumption plan to the DGCA for review before resuming operations. Notwithstanding the DGCA order, we had in any case suspended operations and closed forward bookings till November 6," he said.