Kingfisher flies into tax turbulence

Our Bureau | | Updated on: Mar 12, 2018

Company has not remitted to Govt tax deducted from staff salaries

Troubles continue to mount for the Vijay Mallya-promoted Kingfisher Airlines.

The debt-laden private carrier is now under the Income-Tax Department's lens for non-deposit of tax deducted at source (TDS) from employees' salaries to the exchequer.

Proceedings have already been initiated for the financial year 2010-11 to crystallise the default amount, levy interest on delayed payment and take further statutory actions, Mr S. S. Palanimanickam, Minister of State for Finance, told the Rajya Sabha in a written reply on Tuesday. Preliminary examination by the Income-Tax Department put the liability for 2010-11 at Rs 53.82 crore. In the case of 2011-12, the liability (non-deposit of salary TDS to the exchequer) has been estimated at Rs 100 crore.

Out of the total amount of Rs 153.82 crore for these two years, the Department has collected Rs 21.04 crore. Kingfisher Airlines has filed a commitment letter and undertaken to pay the balance TDS liabilities by the end of the current financial year, Mr Palanimanickam said.

He said that a survey had been conducted, which revealed that the Airline had not adhered to TDS provisions.


To another query, the Minister said that the airline had not defaulted in payment of provident fund dues to the Employees' Provident Fund Organisation.

No dues of EPFO and Employees State Insurance Corporation were pending against Kingfisher Airlines as on end September 2011, he said. Of late, Kingfisher Airlines has been facing financial difficulties.

The Central Board of Excise and Customs (CBEC) had earlier this month frozen some bank accounts of two debt-laden airlines — Kingfisher Airlines and Air India — for defaulting on service tax payments, despite collecting them from passengers.

However, the CBEC later lifted the freeze after both airlines made part-payment of their dues. Kingfisher had paid Rs 9 crore for November. Its total service tax dues for the period April-November were about Rs 110 crore.

Kingfisher Airlines has given a written undertaking to CBEC that it would pay the remaining service tax dues before March-end 2012.


Published on December 20, 2011
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