Struggling Kingfisher Airlines is in talks with the Indian tax authorities to free up cash to settle the outstanding payments which have prompted IATA to suspend the carrier's participation in its Clearing House payment system.
IATA today suspended the airline's participation in the payment system for the second time in a month after Kingfisher failed to settle its Clearing House account on time. The airline had previously been reinstated after its was temporarily suspended from the Clearing House in February.
"Due to the accounts getting attached by the tax authorities, we were not able to make a payment to IATA Clearing House which resulted in a temporary suspension," the airline says. "We are working with the tax authorities and expect the accounts to be unattached shortly. As soon as this is done, we will pay our dues to IATA and get reinstated."
India's tax department froze the airline's bank accounts for the fourth time recently, after it failed to make outstanding payments on 29 February.
The airline says it continues to operate 200 flights to 46 destinations and adds the Clearing House suspension "does not impact our guests travelling on any Kingfisher Airlines flight or our flight schedules".