Service tax due, 2 Kingfisher planes seized

Two Kingfisher airplanes have been impounded in Mumbai in the last three days after the airline’s failure to pay service tax dues of Rs. 63 crore.

Two Kingfisher airplanes have been impounded in Mumbai in the last three days after the airline’s failure to pay service tax dues of Rs63 crore.

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A notice issued by the service tax department states that the airline has additional outstanding dues of about Rs128 crore.

“We have impounded one aircraft while the second one is in the process of detention,” said Sushil Solanki, commissioner, service tax, Mumbai. He added that the department has informally directed the airline not to move three more planes, as they too might be impounded. The airplanes were impounded between December 8 and 10.

The airline can’t lease the aircraft or use it to raise any revenue. This will add to the cash-strapped airline’s problems in resuming services.

A Kingfisher spokesperson said: “We have told the department that the airline is a lesse of the impounded airplanes. Since the airline does not own the aircraft, it can claim compensation against losses incurred because of the department order.”