Jet vows to pay dues today; avert freezing of accounts

Cash-strapped Jet Airways has said it will clear its tax dues today, after the Central Board of Excise and Customs reportedly warned India's largest private airline that its bank accounts would be frozen will be frozen if it does not clear outstanding dues of about Rs69 crore.

"They have 24 hours to make the payment, failing which their accounts will be frozen," CBEC chairman S K Goel was reported as saying on Sunday.
The airline in a statement denied having received any such warning, but said it plans to pay the amount by Monday.

"There is no truth in the statements made to certain sections of the media regarding attaching/freezing any of the company's bank accounts," Jet Airways said in the statement.

India's airlines are reeling under a $20-billion debt load and are struggling to make profits as high fuel prices combined with low fares due to excessive competition and a general economic slowdown are pinching their bottom lines. Five of India's six scheduled carriers are loss-making.

Last month, the accounts of Kingfisher Airlines were frozen over outstanding dues, reportedly to the extent of Rs300 crore. Air India is equally troubled, despite the government-run carrier having got several bailouts. Air India's problems are compounded by gross overstaffing and poor management.

All three airlines have seen agitations by pilots over the last couple of weeks as they are unable to pay salaries on time. Kingfisher and AI have been unable to pay salaries since December; while Jet is paying its pilots at least 15 days late every month.