The author has posted comments on this articleTNN | Dec 12, 2012, 03.59AM IST
MUMBAI: The service tax department has impounded an ATR aircraft belonging to Kingfisher Airlines for defaulting on dues amounting to Rs 63 crore.

The airline owes around Rs 190 crore to the service tax department, of which Rs 127 crore is under litigation. The airline had announced a partial lock-out on October 1, following a strike by its employees over non-payment of salary dues. Two weeks later, the Directorate General of Civil Aviation suspended the airline’s scheduled operators’ permit and the airline has been grounded for the last two months. Meanwhile, airline officials said that they had received a notice from the service tax department to which they had responded.

In a letter sent to assistant commissioner of service tax on Monday, the chief financial officer of the airline, A Raghunathan, said that the aircraft VT-KAR is taken on operating lease by Kingfisher Airlines and so the airline is just lessee and not owner of the aircraft. “Since the aircraft is taken by Kingfisher purely on operating lease basis and the airline is only a lessee of the aircraft, it does not feature as an asset in the books of accounts of Kingfisher,” the letter said.