Bangalore court summons Mallya on Kingfisher tax dues

A special court here Thursday issued summons to the cash-strapped Kingfisher Airlines and its chairman Vijay Mallya in a criminal case related to non-remittance of tax deducted at source (TDS) to the government from salaries of its employees.

Taking cognisance of the offence under sections 276b and 278b of the Income Tax Act, 1962, the special court for economic offences has summoned the airline and Mallya to appear before it April 19 when the hearing resumes.

According to the income tax department here, the criminal complaint against the defaulting airline and Mallya was filed Tuesday in the special court for not remitting Rs.74.94 crore deducted towards TDS in fiscal 2009-10 from its employees across the country.

The department also imposed on the airline Rs.23.70 crore as interest on the TDS amount for defaulting on payment within the stipulated deadline.

The complaint also noted that the debt-ridden airline owed the government a cumulative amount of Rs.401 crore as TDS arrears for four fiscal years from 2008-09 to 2011-12.
Section 276b entails rigorous imprisonment from three months to seven years with fine.
With a cumulated losses of about Rs.8,000 crore and a total debt burden of around Rs.7,524 crore, the airline grounded its operations since October 1, 2012 after its pilots and engineers went on an indefinite strike over non-payment of salaries and other dues.
The aviation regulator, directorate general of civil aviation (DGCA) also suspended Oct 20 the flying licence of the airline, which did not renew after it expired Dec 31.

Meanwhile, in a late evening statement, Kingfisher Airlines termed the I-T department move as illegal saying that the company had already paid these dues, apart from the fact that it was being heard by the Supreme Court.

"The case filed by the Income Tax department is infructuous and needs to be withdrawn. The demand of Rs 74.94 crore, being the TDS on salaries, has already been paid by the company to the tax authorities," it said.

"The Rs 74.94 crore TDS dues demand was set aside by the Income Tax Appellate Tribunal, Karnataka and it is the company's considered view that currently no demand exists," the statement further said.

The company had approached the Supreme Court with a special leave petition and the hearing is posted for March 8.