CAG raps MoCA for Kingfisher Airlines' dues

The Ministry of Civil Aviation has got a rap on its knuckles from the government auditor for "failing" to take steps to recover Rs 9.19 crore from Kingfisher Airlines.

The Comptroller and Auditor General (CAG) said in a report tabled in Parliament that the Ministry has "failed to ensure" that Bangalore International Airport Ltd (BIAL) collect dues from the now-defunct Kingfisher Airlines.

BIAL was to collect Passenger Service Fee through airlines and deposit with the government.

In March 2014, BIAL had sought the approval of the Ministry to write off the dues recoverable from the airline.

"The proposal of BIAL is not tenable as it would be an undue favour to the defaulter and condonation of faikure of BIAL to fulfill its fiduciary responsibility," the CAG said.

"As a result, outstanding dues against airlines accumulated and recovery of Rs 9.19 crore from Kingfisher Airlines was rendered doubtful," it said.

The matter was reported to the Ministry in April last year but the CAG was awaiting reply till January this year.

As of March 2914, Kingfisher Airlines had an outstanding of Rs 16.77 crore out of which Rs 9.64 crore was outstanding for more than one year.

It further increased to Rs 17.44 crore as on March 2016 of which Rs 10.12 crore was outstanding for more than one year, the CAG said. Out of this, Rs 9.19 crore was outstanding from 2012-13 onwards from Kingfisher Airlines, which ceased operations in September 2012.

Though the Ministry received periodic accounts of BIAL, the CAG said, at no time the Ministry directed the airport operator to collect and remit the dues. As per an agreement, BIAL has to deposit dues within 21 days of a request from the government.

"The SOP also did not provide for levyif penal interest for non-payment of dues by the Airlines. In the absence of such a clause, non-recovery of dues constituted an interest-free loan to Kingfisher Airlines," it said.