Calling the report "entirely erroneous", the MIAL statement said it would like to dissociate itself from the comments offered by a MIAL source.
"The story ... is likely to cause possible confusion, misinterpretation and misunderstanding in the minds of our partners, stakeholders and the aviation ministry," the statement said.
An IANS story earlier Tuesday stated that MIAL had served two notices to Kingfisher demanding clearance of dues totalling Rs.53 crore.
"Until the long-pending dues are cleared, we shall not let them fly these aircraft," the source had said on the condition of anonymity.
The dues pertain to parking charges, navigation and other services offered by MIAL in the normal course of airlines operations.
Owned by liquor-king and MP Vijay Mallya, KFA has been grounded since Oct 1 due to financial and labour problems.