AAI plans to encash KF's bank guarantee

New Delhi: The Airports Authority of India (AAI) is planning to encash the Kinfisher Airlines' bank guarantee worth Rs 60-70 crore unless the
airline comes with either cash or a concrete plan for clearing around Rs 256 crore dues within a week.
However, AAI's needs clearance from the civil aviation ministry. "Kingfisher's dues were Rs 256 crore over a month back and by now another Rs 30 crore would have been added. They have paid only about Rs 10 crore. We'll wait till next Monday and if the situation remains unchanged, the action of encashing bank guarantee could be taken," said top sources. A Kingfisher spokesperson said: "We are in dialogue with AAI to mutually agree on a timeframe for settlement of outstanding dues. A meeting is scheduled with top-most AAI officials next Monday."
Kingfisher chairman Vijay Mallya had written to the aviation ministry, seeking instalments to clear the dues. But since Kingfisher is the only private airline with such high dues, the ministry could not be seen to allowing the move for the benefit of one player alone. Air India-Indian Airlines combine also has dues of over Rs 650 crore, but that matter is being treated on a different footing between two government agencies.
Apart from Kingfisher, at least two more private airlines currently have dues that are more than their bank guarantees.
10/11/08 Saurabh Sinha/Times of India

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Categories: Airports Nov 2008, Kingfisher Nov 2008