The service tax department took "temporary custody" of Vijay Mallya's personal jet, an Airbus Corporate Jet costing approximately Rs. 443.85 crore at the Mumbai airport on Tuesday against the pending dues worth Rs. 70 crore.
This is the third aircraft belonging to the cash-strapped airline that was detained by the department over pending dues. "We have taken temporary custody of the aircraft which means the airline cannot use it until they clear the pending dues," said Sushil Solanki, service tax commissioner, Mumbai.
The Kingfisher Airlines, however, denied the claim. "The Airbus Corporate jet VT-VJM, has not been impounded and is not capable of being impounded as the aircraft is not owned by Kingfisher Airlines which is merely the operator under the non-scheduled operators permit," said the spokesperson.
The spokesperson added that CJ Leasing Limited a company based in Cayman Islands owns the aircraft and it is currently mortgaged with the Deutsche Bank in London.
Interestingly the airline had given the same argument to deny the detention of one of its turboprop aircraft VT-KAR in December. "No other aircraft other than Airbus A320 passenger jet (VT-DNZ) and an ATR-72-500 (VT-KAR) have been impounded," said the spokesperson on Thursday.
These two aircraft were impounded in December against pending dues worth approximately Rs. 200 crore.
Meanwhile, Kingfisher employees who had threatened to move court and approach the government to order an inquiry against the company on Wednesday received an email from Mallya assuring them that the management was trying hard to restart the airline.