Defence Minister A K Antony sought to downplay the differences between the two services on the issue, saying it is a "family problem" and the government is in final stages of resolving it.
The Army has been demanding control over attack and medium-lift helicopters, saying they are mainly used for its operations and that is why they should be under it. The IAF has strongly opposed the demand.
"There is no tussle and there is no war. These are all family problems and we will find a solution. We are in the final stages of finding the solution amicably. Don't go beyond that. This has not been rejected," he told reporters on the sidelines of the Territorial Army Day parade here.
He was asked if the Defence Ministry has rejected the Army's demand to have its own fleet of attack and medium-lift helicopters over which the two services are engaged in a battle.
The IAF recently said it has rejected Army's demand to have their own attack and medium-lift helicopters contending that country can't afford to have these "little air forces" growing up to do their "own things".
Commenting on its proposal, Army Chief Gen Bikram Singh, who was present at the function, said the Defence Ministry holds a very "sympathetic view" about the demand raised by the Army for having its own attack helicopters.
It is still under the active consideration of the Ministry and it is not correct for anyone to say that the Ministry has shelved the Army's proposal in this regard, he said.
IAF chief Air Chief Marshal N A K Browne has said "little air forces" cannot be allowed to grow up while asking if the Coast Guard asks for submarines, will it be given the assets by the Navy.