AAI allows SpiceJet to keep flying despite pending dues after carrier posts huge loss
On Wednesday, the AAI had written to SpiceJet saying that since the airline had failed to pay its pending charges it was implementing a cash and carry policy for the carrier.
Mumbai: SpiceJet, which is among the last of the low-cost airlines in the country and announced a net loss of Rs 934.8 crore for the year 2019-2020, has been allowed to operate normally by the Airports Authority of India (AAI) till further notice.
The decision comes after SpiceJet wrote to AAI asking them for more time to work out the modalities to pay pending dues.
The development comes after AAI issued a letter to all regional executive directors and all its other department heads, along with SpiceJet’s chairman and managing director (CMD) informing that the low cost carrier will have to start paying before operating each of their flight in all the airports managed by AAI across the country.
The letter had stated that the airline will have to pay in cash, from midnight on Thursday, to operate its flights as it had failed to clear dues towards parking and landing charges at various airports despite being reminded repeatedly.
The AAI letter dated July 29, a copy of which is with HT, states that it had sent various emails to the airline as a reminder to clear its dues but since the airline had failed to pay its pending charges it was implementing a cash and carry policy for the airline. It did not say how much dues were pending.
But the AAI relented after a request from SpiceJet and issued a statement saying, “The decision to put the All India Operation of M/s SpiceJet on Cash and Carry with effect from 0001 hrs of 30th July 2020 is deferred till further orders.”
A SpiceJet spokesperson said, “The Airports Authority of India deferred its decision to put SpiceJet on cash and carry. We continue to have normal operations at all AAI-run airports as before without any impediments.”
On Wednesday, SpiceJet had announced losses of Rs 807.1 crore in the March quarter of the 2019-20 financial year as against a net profit of Rs 56.3 crore a year ago.
For the whole of 2019-20, net loss stood at Rs 934.8 crore against a net loss of Rs 316.1 crore in 2018-19.
SpiceJet is the second airline that AAI put under cash and carry after it first put Air India in the same bracket where the airline would have to pay to fly.
In the first week of July, Air India too was announced to be put on cash and carry mode by the AAI in Ahmedabad, Bhubaneswar, Chennai and Kolkata airports from July 7.
The decision was taken owing to their long pending dues. However, this decision too was deferred after Air India payed a small amount of the total dues and even wrote to the AAI to allow them more time.