Kingfisher Airlines’ fuel supply halted briefly

Bengaluru  Kingfisher Airlines, the Indian carrier struggling with losses and a cash shortage, had fuel supplies suspended overnight after failing to pay bills. Hindustan Petroleum resumed the supply yesterday after resolving "issues" over fuel bill dues, S. Ram-aswamy, its spokesman, said without elaboration. India's third-largest state refiner stopped supplying Kingfisher on Wednesday evening, B. Mukherjee, its finance director, said yesterday. Kingfisher spokesman Prakash Mirpuri didn't answer three calls to his mobile phone seeking comments. The International Air Transport Association also on Wednesday said it had suspended Bengaluru-based Kingfisher from a clearing system because of overdue payments. The airline, unprofitable for more than 10 straight quarters, said that payment disruption was caused by a freeze on its bank accounts by India's tax authorities. The carrier, controlled by billionaire Vijay Mallya, owes more than Rs4.25 billion (Dh307 million) to Hindustan Petroleum, its biggest supplier, Press Trust of India reported on Wednesday, citing an official at the refiner it didn't identify. Kingfisher has also failed to pay staff, cut flights and taken planes out of service because of cash shortages and accounts being frozen by tax authorities. It this week said Chief Executive Officer Sanjay Aggarwal had asked pilots to continue working and pledged to pay salaries as soon as possible. The carrier fell 6.7 per cent, the most since Nov-ember 29, to Rs21.05 on Wednesday in Mumbai trading. Markets were closed in India yesterday on account of a holiday. Frozen accounts Kingfisher said on Wed-nesday that it is working to free its frozen bank accounts "shortly" and will resume payments to the IATA system once that is done. The IATA facility allows airlines to settle dues to other operators for carrying passengers and freight. The airline industry group said the carrier's participation in the IATA Clearing House will be reinstated after it meets ICH requirements. Kingfisher said on February 3 that an "internal system failure" had disrupted payment and triggered a suspension from ICH. The carrier said then it had cleared all payments and was expecting a reversal of the halt. The IATA statement didn't say whether the group had reversed the previous suspension.