HPCL stops jet fuel supply to Kingfisher Airlines

NEW DELHI: In fresh trouble for Kingfisher Airlines, state-owned Hindustan petroleum Corporation Ltd (HPCL) on Wednesday stopped jet fuel supplies to the ailing carrier due to non-payment of dues which resulted in six flights being cancelled in Bombay and some disruptions in Delhi. HPCL, which is Kingfisher's biggest aviation fuel supplier, stopped refuelling the Vijay Mallya-run firm's airlines at around 6.30 pm on Wednesday, a senior company official said.

The cash-strapped airlines, which has over 425 crore outstanding in fuel dues to HPCL, had not been honouring its daily fuel bills, prompting the oil company to snap supplies. Indian Oil Corporation ( IOC) supplies negligible quantifies to Kingfisher while BPCL continues to sell fuel to the airlines on a cash-and-carry basis at some airports.

In another blow to Kingfisher, the global airlines body IATA suspended it for not clearing its dues. The ailing carrier said payments would be made as soon as tax authorities de-froze its bank accounts. This was the second time in just over a month that the airline was suspended on the same count from the IATA Clearing House through which airlines and related firms settle accounts for services provided by them to other such companies.

A large number of bank accounts of the beleaguered airline have been frozen by the income tax, service tax and excise and customs departments for its failure to clear dues.

"IATA has suspended Kingfisher Airlines' participation in the ICH. This is because the airline did not settle their ICH account within the stipulated deadline," IATA's Assistant Director Albert Tjoeng said in a statement from Singapore.